Broadcom Inc (NASDAQ:AVGO), a global semiconductor firm, experienced a significant fluctuation in its stock value this week. The company saw a decline of about 9.35% in its stock value before rebounding with a rise of 3.48% on Thursday. This volatility has brought the company's market cap from $259.37 billion to $371.14 billion, sparking interest in ownership trends. According to InvestingPro's real-time metrics, the company's adjusted market cap is even higher at $370.45 billion.
Institutional ownership stands at 75.87%, with insiders holding approximately 0.29% of total shares. Notable stakeholders include fund managers Ken Fisher, Barrow, Hanley, Mewhinney & Strauss, and David Tepper.
Although Broadcom's stock price ($888.63) greatly surpasses its GF Value ($667.44), making it appear significantly overvalued, InvestingPro's real-time data shows a different picture. According to InvestingPro, the company's fair value stands at $794.88, hinting at a lesser discrepancy than initially thought. This could mean potentially higher future returns for investors.
Broadcom generates over $30 billion in annual revenue and counts tech giant Apple Inc (NASDAQ:AAPL) as a significant customer, accounting for one-fifth of sales. The company's diversified portfolio includes 17 core product lines and software businesses, contributing to its robust profitability. In fact, InvestingPro Tips highlight that Broadcom has been consistently increasing its earnings per share and has raised its dividend for 13 consecutive years.
InvestingPro's data also reveals that Broadcom's revenue for the last twelve months (LTM2023.Q3) stands at $35.45 billion, with a growth rate of 11.91%. This reflects a slightly slower pace than the previous three-year average annual revenue growth rate of 13.3% mentioned in the article. The company's EBITDA for the same period is $20.33 billion, showing a growth rate of 12.38%.
Broadcom's financial strength is ranked as 6 out of 10 by GuruFocus due to a cash-to-debt ratio that places it lower than most of its industry peers. Yet, the company's profitability is buoyed by products like its best-of-breed FBAR filters for iPhones and diversification into software businesses. InvestingPro Tips also suggest that Broadcom operates with a high return on assets and that its liquid assets exceed short term obligations, providing further evidence of the company's financial strength.
Over the past 12 months, the company reported revenues of $35.50 billion, indicating a three-year average annual revenue growth rate of 13.3% and an EBITDA growth rate of 26%. Broadcom's return on invested capital (ROIC) stands at an impressive 25.6, considerably higher than its cost of capital at 10.75%, indicating efficient cash flow generation relative to its capital investment. The company's growth ranks better than 54.84% of companies in the Semiconductors industry. In line with this, InvestingPro Tips highlight that Broadcom is a prominent player in the Semiconductors & Semiconductor Equipment industry, yielding a high return on invested capital.
For those interested in exploring more insights and metrics, InvestingPro offers additional tips and real-time metrics for Broadcom and other companies. These can be accessed through their InvestingPro product.
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