Analyzing Broadcom In Comparison To Competitors In Semiconductors & Semiconductor Equipment Industry

In today's fast-paced and highly competitive business world, it is crucial for investors and industry followers to conduct comprehensive company evaluations. In this article, we will delve into an extensive industry comparison, evaluatingBroadcomAVGOin relation to its major competitors in the Semiconductors & Semiconductor Equipment industry. By closely examining key financial metrics, market standing, and growth prospects, our objective is to provide valuable insights and highlight company's performance in the industry.Broadcom BackgroundBroadcom is the sixth-largest semiconductor company globally and has expanded into various software businesses, with over $30 billion in annual revenue. It sells 17 core semiconductor product lines across wireless, networking, broadband, storage, and industrial markets. It is primarily a fabless designer but holds some manufacturing in-house, like for its best-of-breed FBAR filters that sell into the Apple iPhone. In software, it sells virtualization, infrastructure, and security software to large enterprises, financial institutions, and governments.Broadcom is the product of consolidation. Its businesses are an amalgamation of former companies like legacy Broadcom and Avago Technologies in chips, as well as Brocade, CA Technologies, and Symantec in software.CompanyP/EP/BP/SROEEBITDA (in billions)Gross Profit (in billions)Revenue GrowthBroadcom Inc101.4218.7823.527.12%$8.02$10.220.16%NVIDIA Corp52.5447.3827.1323.01%$22.58$26.6769.18%Taiwan Semiconductor Manufacturing Co Ltd27.037.6711.148.19%$608.71$493.441.61%Advanced Micro Devices Inc101.033.888.151.23%$1.59$3.7435.9%Texas Instruments Inc40.9811.9812.397.08%$1.85$2.3111.14%Qualcomm Inc16.266.314.2410.3%$3.67$6.0416.93%ARM Holdings PLC197.3622.9339.273.17%$0.46$1.2133.73%Micron Technology Inc22.032.704.093.79%$4.33$3.5136.56%Analog Devices Inc65.963.4412.331.63%$1.2$1.6122.28%Monolithic Power Systems Inc20.0411.0115.304.17%$0.18$0.3539.24%STMicroelectronics NV27.091.612.430.32%$0.51$0.84-27.36%ON Semiconductor Corp40.123.013.72-5.78%$-0.37$0.29-22.39%ASE Technology Holding Co Ltd19.912.101.092.39%$27.16$24.8911.56%United Microelectronics Corp12.011.442.352.06%$23.86$15.455.91%First Solar Inc14.102.174.192.59%$0.35$0.346.35%Credo Technology Group Holding Ltd336.5224.5840.485.63%$0.04$0.11179.73%Skyworks Solutions Inc30.321.963.161.11%$0.22$0.39-8.87%Qorvo Inc154.972.462.310.93%$0.11$0.37-7.6%Lattice Semiconductor Corp145.3810.4515.210.71%$0.02$0.08-14.68%Universal Display Corp32.684.5011.553.93%$0.08$0.130.62%Average71.399.0311.614.02%$36.66$30.6222.62%After a detailed analysis of Broadcom, the following trends become apparent:Notably, the current Price to Earnings ratio for this stock,101.42, is1.42xabove the industry norm, reflecting a higher valuation relative to the industry.It could be trading at a premium in relation to its book value, as indicated by its Price to Book ratio of18.78which exceeds the industry average by2.08x.The Price to Sales ratio of23.52, which is2.03xthe industry average, suggests the stock could potentially be overvalued in relation to its sales performance compared to its peers.With a Return on Equity (ROE) of7.12%that is3.1%above the industry average, it appears that the company exhibits efficient use of equity to generate profits.With lower Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) of$8.02 Billion, which is0.22xbelow the industry average, the company may face lower profitability or financial challenges.The gross profit of$10.2 Billionis0.33xbelow that of its industry, suggesting potential lower revenue after accounting for production costs.The company is witnessing a substantial decline in revenue growth, with a rate of20.16%compared to the industry average of22.62%, which indicates a challenging sales environment.Debt To Equity RatioThe debt-to-equity (D/E) ratio is a financial metric that helps determine the level of financial risk associated with a company's capital structure.Considering the debt-to-equity ratio in industry comparisons allows for a concise evaluation of a company's financial health and risk profile, aiding in informed decision-making.When assessing Broadcom against its top 4 peers using the Debt-to-Equity ratio, the following comparisons can be made:Among its top 4 peers, Broadcom has a higher debt-to-equity ratio of0.97.This suggests a greater reliance on debt financing, which can expose the company to increased financial risk and potential volatility.Key TakeawaysThe high PE, PB, and PS ratios of Broadcom indicate that the company is relatively overvalued compared to its peers in the Semiconductors & Semiconductor Equipment industry. On the other hand, Broadcom's high ROE suggests strong profitability performance, while its low EBITDA, gross profit, and revenue growth indicate potential areas of concern that may impact its competitive position within the industry.This article was generated by Benzinga's automated content engine and reviewed by an editor.AVGOBroadcom Inc$272.98-0.88%Stock Score Locked: Want to See it?Benzinga Rankings give you vital metrics on any stock – anytime.Reveal Full ScoreEdge RankingsMomentum88.39Growth31.82Quality88.41Value9.48Price TrendShortMediumLongOverviewMarket News and Data brought to you by Benzinga APIs© 2025 Benzinga.com. . .Posted In:NewsMarketsTrading IdeasBZI-IA