Exiting Risk Position
Broadcom Corporation (Broadcom) is a global semiconductor solution for wired and wireless communications. Broadcom products deliver voice, video, data and multimedia connectivity in the home, office and mobile environment. The Company’s segment includes Broadband Communications, Mobile and Wireless and Infrastructure and Networking.
[PostStockWidget stock_valuation="" pricetype="live" manual_date="Dec. 21, 2012, 2:04pm GMT" symbolcodes="'BRCM'" symbolprices="27" div_align="right"]
We highlighted a low valuation in Broadcom in September 13 at $26.50. The outlook for Broadcom has since deteriorated and earnings are now expected to decline over the next 2 years. Given that our entry point in September is profitable, we recommend selling at the market and using the funds for better opportunities
Total return on this trade +3.8% in the six weeks since we held the position.
EXIT AT MARKET (BRCM, $US 27.02) FULL POSITION
MKT CAP: $USD 14B POSITION SIZE: FULL (5.0%) P/E: 9.4X DIV: $0.44 (1.69%) P/E/G: 0.6X Debt: N/A RETURN ON CAPITAL: 54.1% EARNINGS YIELD: 8.8% 5 YR EPS Growth rate: 15% CURRENT EPS: $2.87 2014 EST. EPS: $2.43 2015 EST. EPS: $2.69
