Auriga Assumes Coverage on Broadcom (BRCM) at Buy; Bullish on Connectivity/Ethernet Growth and Opex Discipline
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Price: $54.67 --0%
Rating Summary:
15 Buy, 29 Hold, 1 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 13 | Down: 11 | New: 14
Rating Summary:
15 Buy, 29 Hold, 1 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 13 | Down: 11 | New: 14
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Auriga assumes coverage (and Maintains) on Broadcom (NASDAQ: BRCM) with a Buy. PT lowered from $55 to $50.
Auriga analyst says, "We significantly raise our previously above consensus 2011/12 top and bottom line estimates, as our checks are suggesting subdued opex growth for the near/mid-term, and we see continued strength in connectivity and Ethernet driven by secular trends, share gains and significant design wins. However, we reduce our price target to $50 from $55 as we see increased longer-term risks from competitive threats posed by Qualcomm's (Nasdaq: QCOM)(NR) baseband/connectivity integration efforts and also from Nokia's (NYSE: NOK)(NR) move towards Windows. We also lower our 2Q11 estimates as we see potential for Japan related supply-chain disruption in smart phones/tablets. We see recent weakness as an attractive buying opportunity, as we expect BRCM to grow at 15% CAGR through 2015, driven by share gains, entry into new markets, and end market growth."
"We tweak down our Q211 estimate to $1.92bln/$0.70 (pro-forma EPS excl. SBC, one-time items) from $1.96bln/$0.70 (consensus at $1.90bln/$0.67) due to potential supply disruption in smart phones/tablets, but tweak up our CY11 estimate at $7.96bln/$2.99 from $7.90bln/$2.84 (consensus at $7.85bln/$2.79). We also raise our CY12 estimate to $8.93bln/$3.31 from $8.76bln/$3.14 (consensus at $8.64bln/$3.02)."
For more ratings news on Broadcom click here and for the rating history of Broadcom click here.
Shares of Broadcom closed at $38.12 yesterday.
Auriga analyst says, "We significantly raise our previously above consensus 2011/12 top and bottom line estimates, as our checks are suggesting subdued opex growth for the near/mid-term, and we see continued strength in connectivity and Ethernet driven by secular trends, share gains and significant design wins. However, we reduce our price target to $50 from $55 as we see increased longer-term risks from competitive threats posed by Qualcomm's (Nasdaq: QCOM)(NR) baseband/connectivity integration efforts and also from Nokia's (NYSE: NOK)(NR) move towards Windows. We also lower our 2Q11 estimates as we see potential for Japan related supply-chain disruption in smart phones/tablets. We see recent weakness as an attractive buying opportunity, as we expect BRCM to grow at 15% CAGR through 2015, driven by share gains, entry into new markets, and end market growth."
"We tweak down our Q211 estimate to $1.92bln/$0.70 (pro-forma EPS excl. SBC, one-time items) from $1.96bln/$0.70 (consensus at $1.90bln/$0.67) due to potential supply disruption in smart phones/tablets, but tweak up our CY11 estimate at $7.96bln/$2.99 from $7.90bln/$2.84 (consensus at $7.85bln/$2.79). We also raise our CY12 estimate to $8.93bln/$3.31 from $8.76bln/$3.14 (consensus at $8.64bln/$3.02)."
For more ratings news on Broadcom click here and for the rating history of Broadcom click here.
Shares of Broadcom closed at $38.12 yesterday.
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