Back to QCOM: We've already discusses why I prefer QCOM at the moment (keeping in mind that AVGO is one of my all-time favorite stocks). Here's a quick rundown by ShelBot:
🤓 Here is a comparison of QCOM and AVGO as of July 19th, 2023:
- Both QCOM and AVGO have seen strong revenue and earnings growth in the first half of 2023, driven by the increasing demand for 5G chips and devices. QCOM reported a 45% year-over-year increase in revenue and a 92% year-over-year increase in earnings in Q2 2023, while AVGO reported a 28% year-over-year increase in revenue and a 34% year-over-year increase in earnings in Q2 2023¹².
- QCOM has a higher exposure to the smartphone market, especially Apple (AAPL), which accounted for 54% of its revenue in fiscal 2020. AVGO also supplies chips to AAPL, but it has a more diversified revenue stream from other segments, such as data center, enterprise storage, industrial, and cloud¹.
- QCOM has a higher growth potential than AVGO, as it is expected to increase its revenue by 41.6% and its earnings by 97.6% in fiscal 2023. AVGO is projected to grow its revenue by 16.8% and its earnings by 29.7% in fiscal 2023³.
- QCOM has a lower valuation than AVGO, as it trades at a forward price-to-earnings ratio of 13.7, compared to AVGO's 16.9. QCOM also has a lower price-to-sales ratio of 4.5, compared to AVGO's 6.8³.
- AVGO has a higher dividend yield than QCOM, as it pays out 2.9% of its share price annually, compared to QCOM's 1.8%. AVGO also has a lower payout ratio of 51%, compared to QCOM's 66%, indicating more room for dividend growth³.
- AVGO has a higher return on equity than QCOM, as it generated 45.6% of profit from its shareholders' equity in the past year, compared to QCOM's 42%.
