Broadcom Stock Up 64% YTD: Here's What Analysts Expect From Q4 Report

Analysts expect Broadcom Inc AVGO to report $10.98 in EPS and $9.41 billion in revenue as it reports fourth-quarter earnings on Dec. 7 after market hours.

The company, which designs and manufactures a wide range of semiconductors and infrastructure software products, touts Apple Inc. AAPL as one of its biggest customers.

While concerns around Apple replacing a Broadcom chip it uses with an in-house one, kept the stock muted in the earlier half of the year, the VMware acquisition managed to provide the necessary boost to the latter half.

Related: Broadcom-VMware Deal Closure Sends AVGO Stock To New Highs On ‘Sizable Synergy Potential’

AVGO stock is up about 64% YTD largely due to the artificial intelligence (AI) frenzy.

Q4 Earnings Beat Anticipated

On the earnings side, Broadcom has a history of earnings and revenue beats with each passing quarter. For the last 12 quarters, Broadcom has beat on both EPS and revenue estimates. Wall Street analysts would of course be expecting nothing but another beat this quarter.

Oppenheimer: Analyst Rick Schafer expects in-line results for Q4.

Broadcom’s management will likely provide synergy targets from the VMware acquisition on the earnings call, after the report.

Acknowledging Broadcom as “one of the most strategically and financially attractive business models in semiconductors,” Schafer highlighted some key strengths of the business. Broadcom has competitive advantage in the high-end filter market.

Additionally, its business offering is diversified and differentiated. The company also has substantial EPS and FCF growth, thanks to the successful M&A.

Schafer rates the stock as Outperform with a 12-18-month price target of $1,100.

Rosenblatt: Analyst Hans Mosesmann predicts in-line results with “semiconductor AI-driven momentum continuing to offset any weakness in enterprise software.”

Mosesmann expects the much-awaited shift in the company’s revenue mix to be as follows: “a ~40% exposure to enterprise software, ~20% to wireless (Apple), and 40% semiconductors.”

“Broadcom benefits from a new wave of Nvidia compute impacting and stressing data center network scale-out,” said Mosesmann, while reiterating Buy on the stock with a price target of $1,000.

AVGO Price Action: Broadcom stock was trading at $906.90 at the time of publication on Wednesday.

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