Undoubtedly, Broadcom Inc. (NASDAQ:AVGO) has been one of the most volatile stocks in the market in recent times, and the way it handled Monday’s volatility suggests the stock may be poised to rise heading into short-terms. The shares accumulated 1.66 points or 0.61 percent at $275.72 with a light trade volume of 1.569 million shares. After opening the session at $274.4, the shares went as high as $276 and as low as $273.28, the range within which the stock’s price traded throughout the day. The firm is left with a market cap of $114 billion and now has 412 million shares outstanding. Broadcom Inc. (AVGO) stock has gained 10.5 percent of market value in 21 trading days.
AVGO stock has a trailing 3-year beta of 0.69, offering the possibility of a lower rate of return, but also posing less risk. The portion of a company’s profit allocated to each outstanding share of common stock was $11.39 a share in the trailing twelve months. The stock’s value has surged 8.43 percent year to date (YTD) against a rise of 20.1 percent in 12 month’s time. The company’s shares still trade -1.53 percent away from its 1-year high of $280.00 and 39.64 percent up from 52-week low of $197.46. The average consensus rating on the company is 2, on a scale where 5 equates to a unanimous sell rating. In short, the mean analyst recommendations are calling this stock a buy.
Broadcom Inc. (AVGO) will probably climb 5.8 percent over the next 12 months, according to price target estimates compiled by finviz. Meanwhile, they have set a $370 price as 12-month high target. This represents a whopping 34.19 percent increase from where shares are trading today. The 12-month median price target assigned by the analysts stands at $300, which represents a return potential of 8.81 percent when compared to the closing price of the stock of $275.72 on Monday, February 11. The lowest price target for the stock is $240 — slightly more than -12.96 percent from AVGO’s current share price.
History has shown that shares in Broadcom Inc. have gone up on 27 different earnings reaction days and are predicted to add 0.05 percent when the company reports upcoming earnings.
The stock is currently hovering around the first support level of $274. Below this, the next support is placed in the zone of $272.28. Till the time, the AVGO stock trades above this level, bulls have nothing to fear. On momentum oscillators front, ‘RSI’ has touched 62.57 on daily chart, which may remain a cause for concern. If the price breaks below $272.28 level on closing basis, then we may see more profit booking and the stock may show further weakness. On the flipside, hitting the $276.72 mark may result into a pull-back move towards $277.72 level.
Shares of Broadcom Inc. (AVGO) are trading at a P/E ratio of 24.06 times earnings reported for the past 12 months. The industry AVGO operates in has an average P/E of 4113.29. Its P/E ratio went as low as 19.03X and as high as 74.53 over the 5-year span.Further, it is sporting a 5.45 on the Price-to-Sales ratio. Compare this with the industry average P/S of 11.54. 51.6 percent is the gross profit margin for Broadcom Inc. and operating margin sits at 24.1 percent. Along with this, the net profit margin is 58.8 percent.