Shortly after Wednesday’s opening bell, the Dow Jones industrials were down 0.46%, the S&P 500 down 0.34% and the Nasdaq down 0.02%.
After U.S. markets closed on Tuesday, Box reported better-than-expected results on both the top and bottom lines. Second-quarter guidance was slightly above the consensus estimates, and full-year guidance was in line with expectations. Shares traded up by around 2.9% early Wednesday.
HP missed the consensus revenue but posted a beat on earnings per share (EPS). Revenue fell 21% year over year, and PC revenue tumbled by 29% and volume fell by 28%. Guidance for the current quarter and the full fiscal year were in line with expectations. The stock traded down 4.7% Wednesday morning.
Hewlett Packard Enterprise also posted better-than-expected EPS while missing on revenue. Investors did not appear to be in a congenial mood, however, as shares traded down about 9%.
Before markets opened on Wednesday, Frontline reported revenue and EPS above analysts’ estimates. The oil shipper expects demand for oil to rise by about 3 million barrels a day in the second half of this year. That is not out of the question, but not a slam dunk either. Shares traded down 6.1%.
After U.S. markets close on Wednesday, C3.ai, CrowdStrike, Nordstrom and Salesforce are expected to report quarterly results. Then look for reports from Bilibili, Dollar General and Macy’s the following morning.
Here is a preview of three companies releasing their quarterly results later on Thursday.
Broadcom
Chipmaker Broadcom Inc. (NASDAQ: AVGO) has added more than 28% to its share price in the past month, lifting the stock’s 12-month gain to nearly 38%. The company’s recent multiyear, multibillion deal to supply Apple with 5G radio frequency (RF) components and wireless chips certainly helped.
Add to that the company’s claims that its current network switch chips are the equal of Nvidia’s newest Spectrum-X and that the AI powerhouse’s new “lossless Ethernet” is just marketing speak, and Broadcom believes it is well-positioned to compete with Nvidia for a foothold in the AI and machine learning (ML) markets. Should be interesting. Broadcom is also working on getting its $61 billion acquisition of VMware past regulators by a new deadline of November 26.
Analysts remain strongly bullish on the stock, with 20 of 28 having Buy or Strong Buy ratings. Another five rate it at Hold. At a recent share price of around $803.00, the stock has outrun its median price target of $700.00. Based on a high price target of $925.00, the upside potential is 15.2%.
For Broadcom’s fiscal second quarter, analysts are looking for revenue of $8.71 billion, which would be down 2.3% sequentially but up 7.5% year over year. Adjusted EPS are forecast at $10.14, down 1.8% sequentially and 11.8% higher year over year. For the full 2023 fiscal year ending in October, estimates call for EPS of $41.33, up 9.8%, on sales of $35.46 billion, up 6.8%.
Broadcom trades at 19.4 times expected 2023 EPS, 18.1 times estimated 2024 earnings of $44.47 and 17.0 times estimated 2025 earnings of $47.15 per share. Its 52-week trading range is $415.07 to $921.78. Broadcom pays an annual dividend of $18.40 (yield of 2.26%). Total shareholder return for the past year was 42.22%.
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