We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Broadcom, HCL Sign Preferred Services Deal Post CA Buyout
Read MoreHide Full Article
Broadcom (AVGO - Free Report) recently inked a preferred services partnership pact with Noida, India-headquartered HCL Technologies. Per the terms of the pact, HCL will offer professional and technical services to Broadcom’s enterprise software customers.
The partnership will enable Broadcom’s customers to have full access to HCL’s technological expertise across consulting, implementation, upgradation and support services.
The company also informs that, “In addition, the majority of Broadcom’s professional services personnel with expertise including Agile, CyberSecurity, and DevOps will transition to HCL.”
Notably, Broadcom’s enterprise software products were formerly part of CA Technologies. Broadcom concluded CA buyout on Nov 5, 2018, as scheduled. Prior to acquisition, CA Technologies operated primarily in two business segments — mainframe and infrastructure software.
Broadcom attempts to enhance infrastructure technology with this partnership, keeping its “Mainframe and US Public Sector professional services group” outside the terms of the deal.
Notably, shares of Broadcom have returned 10.1% in the past three months, against the industry’s decline of 3.3%.
Key Takeaways
The partnership is in sync with Broadcom’s attempts to expand mission critical technology solutions portfolio on the heels of CA’s enterprise software offerings. The partnership is expected to make the integration process of CA’s software business simpler.
Further, enterprises are focusing on rapid migration to cloud and DevOps technologies to achieve scalability and agility for software development as well as other IT operations. These factors are anticipated to aid Broadcom in offering clients with robust digital experience with the HCL partnership.
The increasing demand of IT management software solutions, persuaded Broadcom to pick CA. CA’s substantial customer base is anticipated to enable Broadcom explore the infrastructure software market and expand its TAM.
Software is ubiquitous and has become the focal point of technological innovation. Notably, the new development inspires optimism as there is an abundance of software opportunities in the digital cloud era.
These factors will pave the way for Broadcom to diversify its end markets and customer base, which bodes well for the long haul. This is anticipated to add resilience to Broadcom’s current business model.
Risks Remain
Broadcom faces intensifying competition and integration risks owing to frequent acquisitions. The company’s leveraged balance sheet and customer concentration remain headwinds.
Long-term earnings growth rate for Twitter, Upland Software and Intel is currently pegged at 22.1%, 22% and 8.4%, respectively.
Today's Stocks from Zacks' Hottest Strategies
It's hard to believe, even for us at Zacks. But while the market gained +21.9% in 2017, our top stock-picking screens have returned +115.0%, +109.3%, +104.9%, +98.6%, and +67.1%.
And this outperformance has not just been a recent phenomenon. Over the years it has been remarkably consistent. From 2000 - 2017, the composite yearly average gain for these strategies has beaten the market more than 19X over. Maybe even more remarkable is the fact that we're willing to share their latest stocks with you without cost or obligation.
Image: Bigstock
Broadcom, HCL Sign Preferred Services Deal Post CA Buyout
Broadcom (AVGO - Free Report) recently inked a preferred services partnership pact with Noida, India-headquartered HCL Technologies. Per the terms of the pact, HCL will offer professional and technical services to Broadcom’s enterprise software customers.
The partnership will enable Broadcom’s customers to have full access to HCL’s technological expertise across consulting, implementation, upgradation and support services.
The company also informs that, “In addition, the majority of Broadcom’s professional services personnel with expertise including Agile, CyberSecurity, and DevOps will transition to HCL.”
Notably, Broadcom’s enterprise software products were formerly part of CA Technologies. Broadcom concluded CA buyout on Nov 5, 2018, as scheduled. Prior to acquisition, CA Technologies operated primarily in two business segments — mainframe and infrastructure software.
Broadcom attempts to enhance infrastructure technology with this partnership, keeping its “Mainframe and US Public Sector professional services group” outside the terms of the deal.
Notably, shares of Broadcom have returned 10.1% in the past three months, against the industry’s decline of 3.3%.
Key Takeaways
The partnership is in sync with Broadcom’s attempts to expand mission critical technology solutions portfolio on the heels of CA’s enterprise software offerings. The partnership is expected to make the integration process of CA’s software business simpler.
Further, enterprises are focusing on rapid migration to cloud and DevOps technologies to achieve scalability and agility for software development as well as other IT operations. These factors are anticipated to aid Broadcom in offering clients with robust digital experience with the HCL partnership.
The increasing demand of IT management software solutions, persuaded Broadcom to pick CA. CA’s substantial customer base is anticipated to enable Broadcom explore the infrastructure software market and expand its TAM.
Software is ubiquitous and has become the focal point of technological innovation. Notably, the new development inspires optimism as there is an abundance of software opportunities in the digital cloud era.
These factors will pave the way for Broadcom to diversify its end markets and customer base, which bodes well for the long haul. This is anticipated to add resilience to Broadcom’s current business model.
Risks Remain
Broadcom faces intensifying competition and integration risks owing to frequent acquisitions. The company’s leveraged balance sheet and customer concentration remain headwinds.
Zacks Rank & Key Picks
Broadcom carries a Zacks Rank #4 (Sell).
Twitter, Inc. , Upland Software (UPLD - Free Report) and Intel (INTC - Free Report) are a few stocks worth considering in the broader technology sector. All the three stocks flaunt a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Long-term earnings growth rate for Twitter, Upland Software and Intel is currently pegged at 22.1%, 22% and 8.4%, respectively.
Today's Stocks from Zacks' Hottest Strategies
It's hard to believe, even for us at Zacks. But while the market gained +21.9% in 2017, our top stock-picking screens have returned +115.0%, +109.3%, +104.9%, +98.6%, and +67.1%.
And this outperformance has not just been a recent phenomenon. Over the years it has been remarkably consistent. From 2000 - 2017, the composite yearly average gain for these strategies has beaten the market more than 19X over. Maybe even more remarkable is the fact that we're willing to share their latest stocks with you without cost or obligation.
See Them Free>>