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Broadcom (AVGO) to Report Q1 Earnings: What's in the Cards?

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Broadcom (AVGO - Free Report) is set to report first-quarter fiscal 2022 results on Mar 3.

For the quarter, Broadcom expects revenues of $7.6 billion. The Zacks Consensus Estimate for revenues currently stands at $7.61 billion, suggesting growth of 14.28% from the year-ago quarter’s reported figure.

The Zacks Consensus Estimate for earnings has remained steady at $8.16 per share over the past 30 days and indicates 23.45% growth from the figure reported in the year-ago quarter.

Broadcom’s earnings beat the Zacks Consensus Estimate in the trailing four quarters, the average earnings surprise being 1.41%.
 

Broadcom Inc. Price and EPS Surprise

Broadcom Inc. Price and EPS Surprise

Broadcom Inc. price-eps-surprise | Broadcom Inc. Quote

 

Let’s see how things have shaped up for Broadcom prior to this announcement:

Factors to Consider

Broadcom’s top-line growth is expected to have benefited from strong demand for its PON fiber in the broadband market, driven by the pandemic-induced work-from-home and online-learning waves. Continued solid demand for DOCSIS 3.1 cable modems has been a key catalyst.

Robust adoption of Wi-Fi 6 and Wi-Fi 6E for access gateways, courtesy of solid demand from homes, enterprises, telcos and other service providers, is expected to have contributed to revenue growth across the broadband end market in the fiscal fourth quarter.

Acceleration in 5G deployment, production ramp-up and increase in radio frequency content are expected to have driven top-line growth.

Broadcom’s fiscal first-quarter performance is likely to reflect synergies from the buyouts of CA and Symantec’s enterprise security business. The pandemic-induced work-from-home trend may have favored the adoption of cloud-based infrastructure software solutions, which is likely to get reflected in the to-be-reported quarter’s top line.

These factors are anticipated to have aided Broadcom’s Infrastructure software revenues.

Broadcom is also benefiting from its partnership with Google Cloud.

What Our Model Indicates

Per the Zacks model, the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here.

Broadcom has an Earnings ESP of -0.09% and a Zacks Rank #2. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Stocks to Consider

Here are a few companies worth considering, as our model shows that these have the right combination of elements to beat on earnings in their upcoming releases:

Designer Brands (DBI - Free Report) has an Earnings ESP of +12.28% and a Zacks Rank of 1. You can see the complete list of today’s Zacks #1 Rank stocks here.

Designer Brands’ shares are down 8.2% year to date compared with the Zacks Retail- Apparel and Shoes industry’s decline of 16.4%.

Marvell Technology (MRVL - Free Report) has an Earnings ESP of +1.76% and a Zacks Rank #2.

Marvell’s shares are down 21.9% year to date compared with the Zacks Technology Services industry’s decline of 22.2%.

Dollar Tree (DLTR - Free Report) has an Earnings ESP of +3.05% and a Zacks Rank of 2.

Dollar Tree’s shares have returned 1.1% year to date against the Zacks Retail- Discount Stores industry’s decline of 11.5%.

 

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.