Why Broadcom Looks Like a Buy NOW

Yes there is still a deceleration in earnings form 23% growth in calendar 2018 to 12% in 2019. However, the January quarter looks to be the bottom. We go from 27% earnings growth in October all the way down to 3% in January. But absent a global meltdown, that looks to be the bottom. After that you get accelerating earnings growth: +3% to +9% to +16% to +10% and overall 12% earnings growth for 2019. And right now you are only paying 9.8 times, plus you get a 4.6% dividend yield. And they have a nice 5G equipment cycle ramping throughout the year. The stock has underperformed the Nasdaq (QQQ) this year, down about 10% YTD. I am not saying all-in, this sell-off is vicious. But Broadcom now screens as decent risk/reward situation going into 2019 – only the 3rd SOXX stock to do that so far.