Broadcom is one the marquis names in the semiconductor space, and while there is worry about its growth potential (especially among iPhone chip providers), this company seems well-diversified enough to take advantage of other opportunities. The market believes it too, providing Broadcom with a hefty multiple. With the stock only 2% off all time highs set a few weeks ago, there is not much room for error.
Technically, the stock broke out of a wide consolidation that lasted about 2 1/2 months. The move up in early December following earnings was on some very strong turnover; this indicates institutional sponsorship. The MACD is closing in on a buy signal, and while the recent action is trendless (higher high, lower low), bouncing off support around $176 could be viewed as a positive. We think this stock will move up toward $200 very soon.
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About Broadcom
Broadcom Limited designs, develops, and supplies a range of complex digital and mixed signal complementary metal oxide semiconductor based devices and analog III-V based products worldwide. The company operates through four segments: Wired Infrastructure, Wireless Communications, Enterprise Storage, and Industrial & Other. The Wired Infrastructure segment provides set-top box system-on-chips (SoCs); cable, digital subscriber line, and passive optical networking central office/consumer premise equipment SoCs; Ethernet switching and routing application specific standard product; embedded processors and controllers; serializer/deserializer application specific integrated circuits; optical and copper physical layers; and fiber optic laser and receiver components. The Wireless Communications segment offers RF front end modules, filters, and power amplifiers; Wi-Fi, Bluetooth, and global positioning system/global navigation satellite system SoCs; and custom touch controllers. The Enterprise Storage segment provides serial attached small computer system interface, and redundant array of independent disks controllers and adapters; peripheral component interconnect express switches; fiber channel host bus adapters; read channel based SoCs; and preamplifiers. The Industrial & Other segment optocouplers; industrial fiber optics motion control encoders and subsystems; and light emitting diodes. Its products are used in various applications, including enterprise and data center networking, home connectivity, set-top boxes, broadband access, telecommunication equipment, smartphones, data center servers and storage systems, factory automation, power generation and alternative energy systems, and electronic displays. The company was formerly known as Avago Technologies Limited and changed its name to Broadcom Limited in February 2016. Broadcom Limited was founded in 2005 and is headquartered in Singapore.
