Broadcom Downgraded to “Hold” at Benchmark Co. (BRCM)

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Wireless chipmaker Broadcom Corporation ( BRCM ) on Monday caught a big downgrade from analysts at Benchmark Co.

The firm said it cut its rating on BRCM from "Buy" to "Hold," citing valuation concerns.

A Benchmark analyst commented, "Shares have increased 28% year-to-date and have approached our previous price target of $40. To compare, the SOX (Philadelphia Semiconductor Index) has risen 18% YTD…Excluding the Qualcomm (Nasdaq: QCOM) royalties, investors may assume Broadcom's earnings power, in optimal industry conditions, to approximate $2.60 to $2.70. Based on this range, shares are trading at 15.0x EPS and are in line with other large-cap semiconductor and tech hardware companies."

Broadcom shares posted small gains in premarket trading Monday.

The Bottom Line
Shares of Broadcom ( BRCM ) have a 1.08% dividend yield, based on Friday's closing stock price of $37.00. The stock has technical support in the $31-$35 price area. If the shares can firm up, we see overhead resistance around the $38-$40 price levels.

Broadcom Corporation ( BRCM ) is not recommended at this time, holding a DARS™ Rating of 3.2 out of 5 stars.

Be sure to visit our complete recommended list of the Best Dividend Stocks , as well as a detailed explanation of our ratings system here .

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

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This article appears in: Investing , Stocks

Referenced Stocks: BRCM

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