Broadcom Inc. (NASDAQ:AVGO) is up 2.4% to trade at $585.34 at last check, amid some broader market tailwinds. The semiconductor concern announced earlier this month it will post second-quarter earnings after the market close on Thursday, June 2. Brokerages firms were quick to push out bull notes following its last earnings report, and The Street expects Broadcom to report an increased EPS (earnings per share) of $8.70 this time around.
On the charts, the equity has struggled to move back towards its Dec. 28, all-time high of $677.76. The $650 level rejected Broadcom stock's late March rally, but shares still have the support of their 200-day moving average. Year-over-year, the equity sports a 36.6% lead, and has gone up since we recommended buying the dip at the end of April.
The chip name holds a weak balance sheet, with $13.7 billion in cash, and $39.7 billion in total debt. AVGO has also lacked consistency with its top- and bottom-line growth rate in recent years. Nonetheless, Broadcom's growth trajectory has been positive, with the business reporting 14.9% revenue growth, and a 127.6% jump in net income for 2021.
Broadcom stock is trading at forward price-earnings ratio of 16.13, which is a decent valuation, given its strong growth expectations. The semiconductor name is estimated to increase revenues 16.4%, and earnings 26.8% this year. AVGO is also expected to grow revenues and earnings 6.2% and 8.8%, respectively, for 2023. What's more, Broadcom stock offers a solid dividend yield of 2.82%, with a forward dividend of $16.40, making the equity an attractive investment for dividend investors to hold long-term.