Broadcom Corporation ($BRCM) Cautious Buy or Hold to $49 Confident Investor Rating: Fair

Company name Broadcom Corporation
Stock ticker BRCM
Live stock price [stckqut]BRCM[/stckqut]
P/E compared to competitors Fair

MANAGEMENT EXECUTION

Employee productivity Good
Sales growth Poor
EPS growth Poor
P/E growth Good
EBIT growth Good

ANALYSIS

Confident Investor Rating Fair
Target stock price (TWCA growth scenario) $65.69
Target stock price (averages with growth) $59.08
Target stock price (averages with no growth) $26.84
Target stock price (manual assumptions) $44.07

The following company description is from Google Finance: http://www.google.com/finance?q=brcm

Broadcom Corporation (Broadcom) is a global semiconductor solution for wired and wireless communications. Broadcom products seamlessly deliver voice, video, data and multimedia connectivity in the home, office and mobile environment. The Company provides system-on-a-chip (SoC), and software solutions. The Company’s segment includes Broadband Communications, Mobile and Wireless and Infrastructure and Networking. Broadcom’s broadband communications segment offers a range of solutions for set-top boxes and broadband access. Broadcom’s mobile and wireless segment offers products that enable wireless and cellular connectivity at home, at work and on-the-go. Through its infrastructure and networking reportable segment, the Company designs and develops silicon and software infrastructure solutions for service provider, data center, and enterprise and small-to-medium business networks.

 

Confident Investor comments: At this time, I think that a Confident Investor can cautiously invest in Broadcom Corporation as long as the price is correct. Most of the fundamentals of this company are good but there are some concerns. I am removing Broadcom from my Watch List.

If you would like to understand how to evaluate companies like I do on this site, please read my book, The Confident Investor. You can review the best companies that I have found (and I probably invest my own money in most of these companies) in my Watch List.

How was this analysis of Broadcom Corporation calculated?

For owners of my book, “The Confident Investor” I offer the following analysis (you must be logged in to this site as a book owner in order to see the following analysis). If you have registered and cannot see the balance of this article, make sure you are logged in and refresh your browser.
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In order to assist you in using the techniques of this book, the values that I used when calculating the Manual pricing above were:

  • Stock price at the time of the calculation: $42.47
  • Growth: 0.11
  • Current EPS (TTM): $1.08
  • P/E: 39
  • Future EPS Calc: $1.81
  • Future Stock Price Calc: $70.97
  • Target stock price: $44.06

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I hope that this makes you a Confident Investor.

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