In the latest trading session, Broadcom Inc. (AVGO) closed at $678.37, marking a -0.57% move from the previous day. This move lagged the S&P 500's daily gain of 0.02%. Elsewhere, the Dow lost 0.42%, while the tech-heavy Nasdaq added 2.7%.
Prior to today's trading, shares of the chipmaker had gained 7.8% over the past month. This has outpaced the Computer and Technology sector's gain of 6.8% and the S&P 500's gain of 1.07% in that time.
Broadcom Inc. will be looking to display strength as it nears its next earnings release, which is expected to be June 1, 2023. On that day, Broadcom Inc. is projected to report earnings of $10.13 per share, which would represent year-over-year growth of 11.69%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $8.71 billion, up 7.5% from the year-ago period.
For the full year, our Zacks Consensus Estimates are projecting earnings of $41.21 per share and revenue of $35.39 billion, which would represent changes of +9.48% and +6.58%, respectively, from the prior year.
Investors should also note any recent changes to analyst estimates for Broadcom Inc.Recent revisions tend to reflect the latest near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.
Our research shows that these estimate changes are directly correlated with near-term stock prices. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.
Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Within the past 30 days, our consensus EPS projection remained stagnant. Broadcom Inc. currently has a Zacks Rank of #3 (Hold).
Valuation is also important, so investors should note that Broadcom Inc. has a Forward P/E ratio of 16.55 right now. This represents a discount compared to its industry's average Forward P/E of 18.29.
Meanwhile, AVGO's PEG ratio is currently 1.3. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. Electronics - Semiconductors stocks are, on average, holding a PEG ratio of 3.66 based on yesterday's closing prices.
The Electronics - Semiconductors industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 200, which puts it in the bottom 21% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
You can find more information on all of these metrics, and much more, on Zacks.com.
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