Broadcom Beats Up on Analysts Yet Again

Seth Jayson, The Motley Fool
Updated

Broadcom (NAS: BRCM) reported earnings on July 24. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended June 30 (Q2), Broadcom met expectations on revenues and beat expectations on earnings per share.

Compared to the prior-year quarter, revenue increased and GAAP earnings per share contracted.


Margins dropped across the board.

Revenue details
Broadcom chalked up revenue of $1.97 billion. The 36 analysts polled by S&P Capital IQ expected a top line of $1.95 billion on the same basis. GAAP reported sales were 10% higher than the prior-year quarter's $1.74 billion.

Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.

EPS details
EPS came in at $0.72. The 34 earnings estimates compiled by S&P Capital IQ anticipated $0.67 per share. GAAP EPS of $0.28 for Q2 were 9.7% lower than the prior-year quarter's $0.31 per share.

Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Margin details
For the quarter, gross margin was 49.1%, 80 basis points worse than the prior-year quarter. Operating margin was 8.3%, 180 basis points worse than the prior-year quarter. Net margin was 8.3%, 170 basis points worse than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $2.09 billion. On the bottom line, the average EPS estimate is $0.77.

Next year's average estimate for revenue is $8.03 billion. The average EPS estimate is $2.93.

Investor sentiment
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 937 members rating the stock outperform, and 77 members rating it underperform. Among 219 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 202 give Broadcom a green thumbs-up, and 17 give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Broadcom is outperform, with an average price target of $42.29.

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The article Broadcom Beats Up on Analysts Yet Again originally appeared on Fool.com.

Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor ofMotley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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