Avago (AVGO)/Broadcom (BRCM) Deal Synergies Could Drive ~$220 Stock Price, Mizuho Securities Says
Mizuho Securities analyst Vijay Rakesh raised estimates and his price target on Outperform-rated Avago Technologies (NASDAQ: AVGO) to $175.00 (from $150.00) following a "solid" quarter and the Broadcom (NASDAQ: BRCM) deal.
Rakesh said the Broadcom deal points to a $200+ stock with synergies. "We would note the combined AVGO+BRCM could drive ~$12EPS and $5.75bn of FCF/year," Rakes said. "Or put another way, long-term on a ~$16.6bn of F16E combined consensus topline, 40% OM and a 5% tax rate, we see AVGO+BRCM EPS at ~$14.70, and at a 15x multiple, the stock is worth ~$220 without buybacks."
For an analyst ratings summary and ratings history on Avago Technologies click here. For more ratings news on Avago Technologies click here.
Shares of Avago Technologies closed at $141.49 yesterday.