CRWD - Broadcom: This Compounder Yielding 3% Is A Buy
- Broadcom is a diversified chip and software behemoth run by a terrific allocator of capital, Hock Tan.
- Chip shortages and the 5G phone upgrade cycle should lead to solid results through at least 2022, while exposure to other end markets positions the company well to benefit from.
- We expect the company’s EPS growth to outpace that of the market over the next several years.
- Despite better expected growth, AVGO trades at an attractive 15.6x P/E multiple, a 20% discount to the market.
- The company has a remarkable track record. From 2015 to 2020, AVGO grew EPS by 20% per year, from roughly $9 to $22 last year.
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Broadcom: This Compounder Yielding 3% Is A Buy