Broadcom Inc. (AVGO) Stock Sinks As Market Gains: What You Should Know

Broadcom Inc. (AVGO) closed at $596.37 in the latest trading session, marking a -0.14% move from the prior day. This move lagged the S&P 500's daily gain of 0.08%. At the same time, the Dow lost 0.56%, and the tech-heavy Nasdaq lost 4.81%.

Coming into today, shares of the chipmaker had lost 6.08% in the past month. In that same time, the Computer and Technology sector lost 2.99%, while the S&P 500 gained 0.64%.

Wall Street will be looking for positivity from Broadcom Inc. as it approaches its next earnings report date. In that report, analysts expect Broadcom Inc. to post earnings of $8.15 per share. This would mark year-over-year growth of 23.3%. Our most recent consensus estimate is calling for quarterly revenue of $7.61 billion, up 14.28% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $33.03 per share and revenue of $30.63 billion. These totals would mark changes of +17.92% and +11.58%, respectively, from last year.

Any recent changes to analyst estimates for Broadcom Inc. 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.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, the Zacks Consensus EPS estimate remained stagnant. Broadcom Inc. is currently a Zacks Rank #1 (Strong Buy).

Valuation is also important, so investors should note that Broadcom Inc. has a Forward P/E ratio of 18.06 right now. For comparison, its industry has an average Forward P/E of 21.91, which means Broadcom Inc. is trading at a discount to the group.

We can also see that AVGO currently has a PEG ratio of 1.24. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. AVGO's industry had an average PEG ratio of 1.66 as of yesterday's close.

The Electronics - Semiconductors industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 77, which puts it in the top 31% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.

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