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Broadcom Inc. (AVGO) closed at $503.25 in the latest trading session, marking a +1.14% move from the prior day. The stock outpaced the S&P 500's daily gain of 0.75%.
Prior to today's trading, shares of the chipmaker had lost 1.92% over the past month. This has was narrower than the Computer and Technology sector's loss of 2.38% and lagged the S&P 500's loss of 0.05% in that time.
Investors will be hoping for strength from AVGO as it approaches its next earnings release. In that report, analysts expect AVGO to post earnings of $7.75 per share. This would mark year-over-year growth of 22.05%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $7.35 billion, up 13.7% from the year-ago period.
AVGO's full-year Zacks Consensus Estimates are calling for earnings of $27.93 per share and revenue of $27.4 billion. These results would represent year-over-year changes of +26.04% and +14.69%, respectively.
It is also important to note the recent changes to analyst estimates for AVGO. These revisions help to show the ever-changing nature of near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.
Our research shows that these estimate changes are directly correlated with near-term stock prices. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate remained stagnant. AVGO is holding a Zacks Rank of #2 (Buy) right now.
Looking at its valuation, AVGO is holding a Forward P/E ratio of 17.82. For comparison, its industry has an average Forward P/E of 19.59, which means AVGO is trading at a discount to the group.
Also, we should mention that AVGO has a PEG ratio of 1.19. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Electronics - Semiconductors industry currently had an average PEG ratio of 1.43 as of yesterday's close.
The Electronics - Semiconductors industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 99, putting it in the top 39% of all 250+ industries.
The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Make sure to utilize Zacks. Com to follow all of these stock-moving metrics, and more, in the coming trading sessions.
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