Looking for the best growth stocks to buy and watch? IBD 50 stock Broadcom is currently about 5% under a 677.86 entry. Broadcom stock fell Thursday amid this week's broad market sell-off.
Broadcom Stock Among Top 5 In Group
San Jose, Calif.-based Broadcom is a leading designer of chips for industrial, auto and computer markets. Broadcom stock has an 95 Earnings Per Share Rating and holds the No. 5 rank among its peers in the Electronics-Semiconductor Fabless industry group. Rambus and Alpha & Omega Semiconductor are also among the top five highly rated stocks within the group.
Among its other key ratings, Broadcom stock has a powerful A Rating for sales plus margins plus return on equity (SMR), on an A to E scale with A tops. However, because of past years' weakness some of its other ratings are not so hot. For example it has an OK but not great 64 Composite Rating and a weak 34 Relative Strength Rating, indicating that Broadcom stock's price performance lags that of other stocks.
Profit Popped 40% Last Quarter
However, earnings and sales growth are strong. Last quarter Broadcom reported a 40% jump in EPS to $9.73 on a 25% increase in revenue to $8.46 billion. It's one of the few chipmakers that has reported double-digit sales and profit growth every quarter over the past year.
Consensus analyst estimates call for EPS growth of 32% for the quarter, and 27% growth for the full year. Annual growth estimates were recently revised higher.
It should be noted that the current formation for Broadcom stock is a third-stage cup without handle, which means it's more prone to failure than a first- or second-stage formation.
