2023-05-01 10:32:02 ET
Broadcom (NASDAQ: AVGO) is often considered a safe blue chip tech stock for conservative income investors. It produces a wide range of chips for the data center, networking, broadband, wireless, storage, and industrial markets, and it also sells infrastructure software through its CA Technologies and Symantec subsidiaries.
Its revenue has grown at a compound annual growth rate (CAGR) of 13% between fiscal 2017 and fiscal 2022 (which ended last October), as its adjusted earnings per share (EPS) rose at a CAGR of 19%. Its diversification shielded it from the PC market's post-pandemic slowdown, and its stock still looks cheap at 15 times forward earnings despite rallying nearly 170% over the past five years. It also pays a forward dividend yield of 3%, and that payout should consume less than half of its projected EPS this year.
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2 Red Flags for Broadcom's Future