Fabless chip and software maker Broadcom (NASDAQ:AVGO) will be announcing earnings results tomorrow after market close. Here’s what to expect.
Broadcom beat analysts’ revenue expectations by 4% last quarter, reporting revenues of $12.49 billion, up 43% year on year. It was a decent quarter for the company, with a meaningful improvement in its inventory levels. Looking ahead, its full-year revenue and EBITDA guidance topped Wall Street's estimates.
Is Broadcom a buy or sell going into earnings? Read our full analysis here, it’s free.
This quarter, analysts are expecting Broadcom’s revenue to grow 46% year on year to $12.96 billion, improving from the 4.9% increase it recorded in the same quarter last year. Adjusted earnings are expected to come in at $1.20 per share.
The majority of analysts covering the company have reconfirmed their estimates over the last 30 days, suggesting they anticipate the business to stay the course heading into earnings. Broadcom has a history of exceeding Wall Street’s expectations, beating revenue estimates every single time over the past two years by 1% on average.
Looking at Broadcom’s peers in the processors and graphics chips segment, some have already reported their Q2 results, giving us a hint as to what we can expect. Nvidia delivered year-on-year revenue growth of 122%, beating analysts’ expectations by 4.5%, and Qorvo reported revenues up 36.2%, topping estimates by 4.1%. Nvidia traded down 6.4% following the results while Qorvo’s stock price was unchanged.
Read our full analysis of Nvidia’s results here and Qorvo’s results here.
There has been positive sentiment among investors in the processors and graphics chips segment, with share prices up 4.7% on average over the last month. Broadcom is up 6.7% during the same time and is heading into earnings with an average analyst price target of $192.4 (compared to the current share price of $153.5).
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