Broadcom (AVGO) Beats Earnings and Revenue Estimates, Offers Higher Q1 Guidance, Prompting Analysts to Hike Numbers and PTs
- S&P 500, Dow climb for third day and close at records
- Tesla (TSLA) China Numbers 'Robust' - Wedbush
- Apple (AAPL) Shares Seen as 'Attractive' as Recent Checks Show Continuously Strong Demand - Citi
- Investors Poured More Money Into Stocks in Past 5 Months Than Last 12 Years, Says BofA, Analysts Worried About Stretched Valuations
- Amazon.com warehouse workers vote to reject forming union in Alabama
Get instant alerts when news breaks on your stocks. Claim your 1-week free trial to StreetInsider Premium here.
Broadcom (NASDAQ: AVGO) reported better-than-expected earnings for its fiscal first quarter, but shares still slipped 1% in pre-open trading Friday.
The company made a profit of $6.61 per share to top the market expectations of a profit of $6.55 per share. Revenue came in at $6.66 billion to beat the $6.61 billion expected from the market.
Sales soared 14% to push earnings 26% higher compared to a year-ago period. For the current quarter, the company is projecting sales of $6.5 billion to top the $6.33 billion expected from the Street.
"We executed well during our first fiscal quarter driving 14% organic growth year on year. This growth reflects the critical role our technology franchises play in this environment of accelerated digital transformation,” " said Hock Tan, President and CEO of Broadcom Inc.
"This quarter highlights the strength of our financial model with 14% year over year revenue growth translating to an increase in operating profit of 23%. We continue to deliver strong free cash flow, approximately $3 billion in the quarter, representing 35% growth on a year on year basis,” CFO Kirsten Spears added.
Rosenblatt analyst Hans Mosesmann praised the company for “impressive handling of the currency cycle.” He hiked the price target to $540.00 per share from $470.00 on the Buy-rated AVGO.
Mosesmann especially highlighted a decision by the company, made 9 months ago, to implement a “non-cancellable bookings policy”.
“Given Broadcom’s model of targeting its leadership products (sole source and or highly sticky) to flagship customers, management has particularly good visibility into what these customers need in terms of demand vs. inventory replenishment. Of course, from a product perspective, the company is executing flawlessly in its various networking (Tomahawk series, WiFi6, etc.), wireless (content at Apple), storage, and broadband semiconductor strategic segments, plus Infrastructure Software stability,” the analyst wrote in today’s note sent to clients.
Vijay Rakesh, managing director at Mizuho Securities, also raised the price target to $490.00 per share from $480.00 to reflect higher estimates.
“We continue to see AVGO well positioned with leadership in growing markets driven by secular trends 5G and data center, high margins and strong FCF,” Rakes said in today’s note.
Serious News for Serious Traders! Try StreetInsider.com Premium Free!
You May Also Be Interested In
- UPDATE: Mizuho Securities Starts Ameren Corp (AEE) at Neutral (correction)
- UPDATE: Goldman Sachs Starts Reliance Steel & Aluminum (RS) at Neutral
- UPDATE: Stifel Downgrades Chuy's Holdings (CHUY) to Hold Following Strong Performance
Create E-mail Alert Related CategoriesAnalyst Comments, Analyst EPS View, Earnings
Related EntitiesEarnings, Pre Market Movers, Rosenblatt
Sign up for StreetInsider Free!
Receive full access to all new and archived articles, unlimited portfolio tracking, e-mail alerts, custom newswires and RSS feeds - and more!