Broadcom (NASDAQ:AVGO) PT Set at $338.00 by Morgan Stanley

Key Points

• Morgan Stanley has raised its price target for Broadcom's stock from $270.00 to $338.00, indicating a potential upside of 13.64% from the stock's previous close, and maintains an "overweight" rating.
• Broadcom reported a quarterly revenue of $15 billion, surpassing analysts' expectations, and had a net margin of 22.64%.
• The company has authorized a $10 billion share buyback plan, suggesting that its board believes the stock may be undervalued.

Broadcom (NASDAQ:AVGO - Get Free Report) has been given a $338.00 target price by analysts at Morgan Stanley in a research note issued to investors on Wednesday, Marketbeat.com reports. The firm presently has an "overweight" rating on the semiconductor manufacturer's stock. Morgan Stanley's price target indicates a potential upside of 17.10% from the company's current price.

A number of other research analysts also recently commented on AVGO. Susquehanna boosted their price target on Broadcom from $280.00 to $300.00 and gave the company a "positive" rating in a research note on Friday, June 6th. Citigroup boosted their price target on Broadcom from $285.00 to $315.00 and gave the company a "buy" rating in a research note on Monday, July 7th. Erste Group Bank raised Broadcom from a "hold" rating to a "buy" rating in a research note on Thursday, June 5th. Rosenblatt Securities boosted their price target on Broadcom from $223.00 to $340.00 and gave the company a "buy" rating in a research note on Friday, June 6th. Finally, Benchmark boosted their target price on Broadcom from $255.00 to $315.00 and gave the stock a "buy" rating in a research note on Friday, June 6th. One analyst has rated the stock with a hold rating, twenty-seven have issued a buy rating and three have issued a strong buy rating to the stock. Based on data from MarketBeat.com, the stock has a consensus rating of "Buy" and a consensus target price of $294.92.

Broadcom Stock Performance

Shares of AVGO traded down $5.06 during midday trading on Wednesday, reaching $288.64. 21,405,316 shares of the stock were exchanged, compared to its average volume of 26,886,023. Broadcom has a twelve month low of $128.50 and a twelve month high of $306.95. The company has a quick ratio of 0.98, a current ratio of 1.08 and a debt-to-equity ratio of 0.89. The company has a market cap of $1.36 trillion, a P/E ratio of 108.10, a PEG ratio of 2.15 and a beta of 1.12. The stock's 50 day simple moving average is $265.36 and its 200 day simple moving average is $224.11.

Broadcom (NASDAQ:AVGO - Get Free Report) last posted its earnings results on Thursday, June 5th. The semiconductor manufacturer reported $1.58 earnings per share for the quarter, topping analysts' consensus estimates of $1.57 by $0.01. Broadcom had a return on equity of 35.49% and a net margin of 22.64%. The company had revenue of $15 billion during the quarter, compared to the consensus estimate of $14.98 billion. During the same quarter last year, the firm earned $10.96 earnings per share. The company's revenue was up 20.2% on a year-over-year basis. On average, sell-side analysts expect that Broadcom will post 5.38 earnings per share for the current year.

Broadcom declared that its Board of Directors has authorized a share repurchase program on Monday, April 7th that permits the company to buyback $10.00 billion in outstanding shares. This buyback authorization permits the semiconductor manufacturer to purchase up to 1.4% of its shares through open market purchases. Shares buyback programs are typically a sign that the company's leadership believes its shares are undervalued.

Insider Activity at Broadcom

In related news, CEO Hock E. Tan sold 117,758 shares of the stock in a transaction on Thursday, June 12th. The stock was sold at an average price of $252.91, for a total value of $29,782,175.78. Following the completion of the sale, the chief executive officer directly owned 1,014,152 shares of the company's stock, valued at approximately $256,489,182.32. This represents a 10.40% decrease in their position. The transaction was disclosed in a filing with the SEC, which can be accessed through the SEC website. Also, insider Charlie B. Kawwas sold 10,000 shares of the stock in a transaction on Wednesday, June 11th. The shares were sold at an average price of $252.88, for a total value of $2,528,800.00. Following the completion of the sale, the insider directly owned 789,784 shares of the company's stock, valued at $199,720,577.92. The trade was a 1.25% decrease in their ownership of the stock. The disclosure for this sale can be found here. Insiders sold 830,516 shares of company stock valued at $217,224,641 over the last three months. 2.00% of the stock is currently owned by company insiders.

Institutional Inflows and Outflows

A number of institutional investors have recently bought and sold shares of the business. Sawyer & Company Inc grew its stake in shares of Broadcom by 62.1% during the 2nd quarter. Sawyer & Company Inc now owns 94 shares of the semiconductor manufacturer's stock worth $26,000 after acquiring an additional 36 shares during the period. PFS Partners LLC raised its holdings in shares of Broadcom by 38.4% in the 2nd quarter. PFS Partners LLC now owns 137 shares of the semiconductor manufacturer's stock valued at $38,000 after acquiring an additional 38 shares in the last quarter. Costello Asset Management INC raised its holdings in shares of Broadcom by 1.5% in the 2nd quarter. Costello Asset Management INC now owns 2,528 shares of the semiconductor manufacturer's stock valued at $697,000 after acquiring an additional 38 shares in the last quarter. Waddell & Associates LLC raised its holdings in shares of Broadcom by 2.1% in the 1st quarter. Waddell & Associates LLC now owns 2,091 shares of the semiconductor manufacturer's stock valued at $350,000 after acquiring an additional 43 shares in the last quarter. Finally, Luts & Greenleigh Group Inc. raised its holdings in shares of Broadcom by 1.3% during the 2nd quarter. Luts & Greenleigh Group Inc. now owns 3,405 shares of the semiconductor manufacturer's stock valued at $939,000 after buying an additional 44 shares in the last quarter. Institutional investors own 76.43% of the company's stock.

About Broadcom

Broadcom Inc designs, develops, and supplies various semiconductor devices with a focus on complex digital and mixed signal complementary metal oxide semiconductor based devices and analog III-V based products worldwide. The company operates in two segments, Semiconductor Solutions and Infrastructure Software.