In the latest trading session, Broadcom Inc. (AVGO) closed at $266.44, marking a -0.46% move from the previous day. This change lagged the S&P 500's daily gain of 1.3%. At the same time, the Dow added 1.21%, and the tech-heavy Nasdaq gained 1.39%.
Coming into today, shares of the chipmaker had lost 2.65% in the past month. In that same time, the Computer and Technology sector lost 4.48%, while the S&P 500 lost 4.84%.
Investors will be hoping for strength from AVGO as it approaches its next earnings release. On that day, AVGO is projected to report earnings of $5.10 per share, which would represent year-over-year growth of 2.41%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $5.50 billion, up 8.69% from the year-ago period.
For the full year, our Zacks Consensus Estimates are projecting earnings of $21.36 per share and revenue of $22.61 billion, which would represent changes of +2.59% and +8.46%, respectively, from the prior year.
Any recent changes to analyst estimates for AVGO should also be noted by investors. 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.
Based on our research, we believe these estimate revisions are directly related to near-team stock moves. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.
The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.76% higher. AVGO is holding a Zacks Rank of #3 (Hold) right now.
Valuation is also important, so investors should note that AVGO has a Forward P/E ratio of 12.53 right now. For comparison, its industry has an average Forward P/E of 18.1, which means AVGO is trading at a discount to the group.
We can also see that AVGO currently has a PEG ratio of 1.06. 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. Electronics - Semiconductors stocks are, on average, holding a PEG ratio of 1.84 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 103, which puts it in the top 41% 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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