Broadcom Stock Analysis (NASDAQ:AVGO)
Broadcom Analysis Video
View Broadcom stock analysis video. This is our AVGO analyst opinion covering the buy and sell arguments for AVGO stock.
Broadcom Ltd Stock Rating (3/5)
Our Broadcom stock opinion is based on fundamentals of the company. This Broadcom stock analysis is based on latest Q2 earnings for 2017. The stock price analysis takes into account a company's valuation metrics.
Should you buy AVGO stock?
- Broadcom sales grew by 18.3% year on year in 2017 Q2.
- Revenue growth has been tremendous with a compounded annual growth of 47% over the last 5 years.
- The company has an operating cash flow which is 3.6 times the net income.
- The price to earnings multiple of 21.1 is attractive when compared with the industry average PE ratio of 26.4.
- Broadcom has a healthy FCF (Free Cash Flow) margin of 31.7%.
Should you sell AVGO stock?
- Over the last 12 months, Broadcom had an average Net loss of -1.5%.
- Broadcom has a debt/equity ratio of 0.61, which is worse than the average in the Computer and Technology sector.
- The company is trading at a price to sales multiple of 6.3, which is higher in comparison to the Electronics-Semiconductors industry average of 2.8, making AVGO stock expensive.
- Broadcom's negative ROIC of -1% indicates operational inefficiency.
- Broadcom has a negative return on equity of -1.1%. This indicates that the firm is inefficient at generating profits.