Broadcom Stock Rating Reaffirmed by Bank of America (BRCM)
Broadcom (NASDAQ:BRCM)‘s stock had its “buy” rating reiterated by investment analysts at Bank of America in a note issued to investors on Friday. They currently have a $50.00 price target on the stock, up from their previous price target of $45.00. Bank of America’s target price would indicate a potential upside of 24.63% from the company’s current price.
The analysts wrote, “BRCM trades at a 20%+ discount to the sector as investors worry about competitive risks in Wi-Fi connectivity and dilution from stock comp expense. However, we think the Street could be overlooking BRCM’s core, leadership in attractive Networking and Broadband markets that account for 60%+ of sales and 80%+ of profits. We develop a sum of parts model that suggests a valuation of $46/sh (15% potential upside) even if Wi-Fi connectivity has zero value, primarily on the strength in the core business, with upside to $54/sh (35% potential upside) if connectivity sales can stabilize.At just 12x PE, 9x 2015E EV/EBTDA, solid 7-8% FCF yield, BRCM’s assets look too attractive and transformation too impactful to ignore in a consolidating industry, in our view.”
Several other analysts have also recently commented on the stock. Analysts at Jefferies Group reiterated a “buy” rating on shares of Broadcom in a research note on Monday, August 11th. Separately, analysts at Bernstein raised their price target on shares of Broadcom from $44.00 to $46.00 in a research note on Wednesday, July 23rd. They now have an “outperform” rating on the stock. Finally, analysts at Susquehanna raised their price target on shares of Broadcom from $40.00 to $45.00 in a research note on Wednesday, July 23rd. They now have a “positive” rating on the stock. One equities research analyst has rated the stock with a sell rating, twelve have given a hold rating and twenty-two have issued a buy rating to the company’s stock. The company has a consensus rating of “Buy” and a consensus price target of $41.12.
In other Broadcom news, Chairman Henry Samueli sold 125,000 shares of Broadcom stock in a transaction that occurred on Wednesday, September 3rd. The stock was sold at an average price of $39.37, for a total transaction of $4,921,250.00. The transaction was disclosed in a filing with the SEC, which is available at this link.
Shares of Broadcom (NASDAQ:BRCM) opened at 40.12 on Friday. Broadcom has a 52-week low of $24.60 and a 52-week high of $40.74. The stock has a 50-day moving average of $38.32 and a 200-day moving average of $34.12. The company has a market cap of $23.711 billion and a P/E ratio of 36.47. Broadcom also was the target of unusually large options trading on Tuesday. Stock traders acquired 10,955 call options on the company. This represents an increase of approximately 367% compared to the typical daily volume of 2,346 call options.
Broadcom (NASDAQ:BRCM) last released its earnings data on Tuesday, July 22nd. The company reported $0.65 EPS for the quarter, beating the Thomson Reuters consensus estimate of $0.61 by $0.04. The company had revenue of $2.04 billion for the quarter, compared to the consensus estimate of $2.05 billion. During the same quarter in the prior year, the company posted $0.70 earnings per share. The company’s quarterly revenue was down 2.3% on a year-over-year basis. On average, analysts predict that Broadcom will post $2.84 earnings per share for the current fiscal year.
The company also recently declared a quarterly dividend, which is scheduled for Monday, September 15th. Investors of record on Friday, August 29th will be given a dividend of $0.12 per share. This represents a $0.48 dividend on an annualized basis and a yield of 1.20%. The ex-dividend date of this dividend is Wednesday, August 27th.
Broadcom Corporation (NASDAQ:BRCM), is a global semiconductor solution for wired and wireless communications.
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