Broadcom Ltd. (AVGO): Raising PT Ahead Of Earnings - RBC

August 29, 2016 6:19 AM EDT
Get Alerts AVGO Hot Sheet
Price: $173.00 -0.37%

Rating Summary:
    38 Buy, 2 Hold, 0 Sell

Rating Trend: = Flat

Today's Overall Ratings:
    Up: 17 | Down: 27 | New: 7
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RBC Capital analyst, Amit Daryanani, reiteragted Broadcom Limited (NASDAQ: AVGO) as his Top Pick ahead of earnings on 9/1. The analyst believes AVGO will show Revenue upside as well as EPS upside due to:

1) Better AAPL trends given implied sell through at AAPL was ~44M units (sell-in was 40M) and implied Sept-qtr q/q guide was better than recent trends/expectations

2) HDD Inflecting: Aggregate HDD TAM was better in June-qtr and notably higher in Sept-qtr driven by strong hyperscale and gaming demand (8TB/10TB Hyperscale ramp should help AVGO)

3) Enterprise: We expect strong server/hardware data from IBM being an incr. positive for ELX (AVGO’s core FC HBA)

4) Wired: Expect stable to improving underlying trends coupled with alleviating production bottleneck being a positive.

Beyond the July-qtr, the analyst believes AVGO will sustain $16.00+ EPS by FY19 leading the stock to a price over $200. Therefore, he raises his price target to $190 from $185.

For an analyst ratings summary and ratings history on Broadcom Limited click here. For more ratings news on Broadcom Limited click here.

Shares of Broadcom Limited closed at $177.16 yesterday.

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