Broadcom (AVGO, $362.95) beats Q2 earnings and revenue estimates

Broadcom   reported third-quarter earnings that surpassed analysts’ expectations.  

For the quarter ended Aug. 2, the semiconductor and software company’s non-GAAP earnings of $5.40 a share, beat the $5.24 expected by analysts polled by FactSet.

Revenue for the quarter came in at $5.82 billion, compared to analysts’ estimate of $5.76 billion.

Semiconductor revenue was $4.2 billion in the quarter, which is 72% of its overall revenue.

Looking ahead, the company expects fourth quarter revenue to range between $6.25 billion and $6.55 billion, compared to analysts’ forecast of $6.18 billion. 

“Looking ahead, our cash-flow outlook remains robust and we plan to pay down an additional $3 billion in debt in the fourth quarter," said Chief Financial Officer Tom Krause.

Tickeron's analysis of shows that, AVGO's in Uptrend: Moving Average Convergence Divergence (MACD) Histogram just turned positive

This is a Bullish indicator signaling AVGO's price could rise. Traders may explore going long on the ticker or buying call options. In 31 of 43 cases where AVGO's MACD histogram became positive, the price rose further within the following month. The odds of a continued Uptrend are 72%.

Current price $362.95 is above $327.36 the highest support line found by A.I. Throughout the month of 08/05/20 - 09/04/20, the price experienced a +10% Uptrend. During the week of 08/28/20 - 09/04/20, the stock enjoyed a +5% Uptrend growth.

Technical Analysis (Indicators)

Bullish Trend Analysis

The Momentum Indicator exceeded the 0 level on August 21, 2020. Traders may consider buying the ticker or exploring call options. In 68 of 95 cases where the ticker's Momentum Indicator exceeded 0, its price rose further within the subsequent month. The odds of a continued Uptrend are 72%.

The Aroon Indicator entered an Uptrend today. In 167 of 295 similar cases where AVGO Aroon's Indicator entered an Uptrend, the price rose further within the following month. The odds of a continued Uptrend are 57%.

Bearish Trend Analysis

The RSI Indicator appears to be shifting from an Uptrend to a Downtrend. In 25 of 40 cases where AVGO's RSI indicator exited the overbought zone, the price fell further within the following month. The odds of a continued Downtrend are 63%.

The Stochastic Indicator may be shifting from an Uptrend to a Downtrend. In 40 of 66 cases where AVGO's Stochastic indicator exited the overbought zone, the price fell further within the following month. The odds of a continued Downtrend are 61%.

The higher Bollinger Band was broken -- a price fall is expected as the ticker heads toward the middle band, which invites the trader to consider selling or shorting the ticker, or exploring put options. In 27 of 45 cases where AVGO's price broke its higher Bollinger Band, its price dropped further during the following month. The odds of a continued Downtrend are 60%.

Fundamental Analysis (Ratings)

Tickeron has a positive outlook on this ticker and predicts a further increase by more than 4.00% within the next month with a likelihood of 56%. During the last month, the daily ratio of advancing to declining volumes was 1.9 to 1.

The Tickeron Valuation Rating of 8 (best 1 - 100 worst) indicates that the company is seriously undervalued in the industry. This rating compares market capitalization estimated by our proprietary formula with the current market capitalization. This rating is based on the following metrics, as compared to industry averages: P/B Ratio (6.10) is normal, around the industry mean (4.91). P/E Ratio (68.13) is within average values for comparable stocks, (84.09). Projected Growth (PEG Ratio) (0.00) is also within normal values, averaging (2.21). AVGO's Dividend Yield (3.57) is considerably higher than the industry average of (0.59). P/S Ratio (5.76) is also within normal values, averaging (4.39).

The Tickeron Price Growth Rating for this company is 8 (best 1 - 100 worst), indicating outstanding price growth. AVGO’s price grows at a higher rate over the last 12 months as compared to S&P 500 index constituents.

The Tickeron Profit vs. Risk Rating rating for this company is 15 (best 1 - 100 worst), indicating low risk on high returns. The average Profit vs. Risk Rating rating for the industry is 58, placing this stock better than average.

The Tickeron PE Growth Rating for this company is 21 (best 1 - 100 worst), pointing to outstanding earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents.

The Tickeron SMR rating for this company is 58 (best 1 - 100 worst), indicating strong sales and a profitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.