Boston, MA 10/24/2013 (wallstreetpr) – Communications chipmaker Broadcom Corporation (NASDAQ:BRCM) shares dropped by almost 3% on October 23, just after the semiconductor equipment manufacturer released its quarterly earnings report on October 22.
The semiconductor major reported better third-quarter profits of $316 million on Tuesday on revenue of $2.15 billion, compared with $220 million on sales of $2.13 billion for the same quarter of FY2012. Excluding one-time items, the company earned 76 cents a share. Investors had expected earnings of 68 cents a share over $2.13 billion in revenue.
Analysts feel turbulent conditions prevailing in the mobile market segment impacted Broadcom’s performance and predict better rebuilding in 2014. Experts feel the industry major could still be a high-rising stock to keep an eye on, with about 15.10 million shares traded on October 23, significantly above the average trading volume of 8.20 million shares.
A leader in the semiconductor equipment and solutions space for wired and wireless communications, Broadcom’s product line comprises voice, video, data, and multimedia connectivity for the home, office and mobile environments. With a rather high increase of 54.69% in gross profit margin, compared to the same quarter of FY2012, Broadcom’s net profit margin of -12.00% is in sync with the industry average. The company is currently valued at around $15.71 billion, with a stock dividend yield of 1.7%.
With a low 0.21 debt-to-equity ratio, the technology giant is currently below the industry average, implying good debt management, while its quick ratio of 1.95 indicates the company’s ability to cover short-term liquidity needs.
Meanwhile, the California-based technology major recently collaborated with UK-based ARM Holdings plc (ADR) (NASDAQ:ARMH) for developing a new processor architecture for upcoming breakthrough networking technologies. Plans to axe approximately 1,150 jobs, about one-tenth of its workforce, as a part of its global restructuring plans are also underway.
Broadcom shares were trading at $26.36 at market close on October 23. After-hours trading saw the stocks rising up to $26.40.
