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AVGO

Broadcom Inc – Semiconductor and Related Device Manufacturing
Broadcom Inc. is an American multinational designer, developer, manufacturer, and global supplier of a wide range of semiconductor and infrastructure software products. Broadcoms product offerings serve the data center, networking, software, broadband, wireless, storage, and industrial markets.
Analysis Results
Intrinsic Value $1,152.40
Latest Price $1,295.16
Relative Value 12% overvalued
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Cash Flow (Billions)
Analysis Parameters
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Analysis Details
Growth Rate Projection

An exponential growth model was fit to the past cash flow data, giving more weight to more recent years. This model determined a growth rate estimate of 25.5%.

Weighted Average Cost of Capital (WACC)

The calculated WACC is 11.3%. This value is used as the default discount rate.

Value of Future Flows

Assuming a growth rate of 25.5%, the cash flows for the next 5 years are projected.

The present value of each year's flow is adjusted to present value using the discount rate.

Year Future flow (billion) Present value (billion)
2024 26.6 23.9
2025 33.4 26.9
2026 41.9 30.4
2027 52.6 34.2
2028 66.0 38.6
Terminal Value

Assuming a growth rate after the projection years of 2.0%, the terminal value of the company would be 723 billion. This corresponds to a present value of 380 billion.

Intrinsic Value Per Share

The total present value of the projected cash flows is 154 billion. Adding in the terminal value gives a total present value of 534 billion.

There are presently 463.0 million outstanding shares, so the intrinsic value per share is 1152.4.

Financial Statements

The following data was to determine the past cash flows.

Current Assets 20,847,000,000
Current Cash 14,189,000,000
Current Liabilities 7,405,000,000
Current Debt 1,608,000,000
Non-Cash Working Capital (NCWC) 861,000,000
Change in NCWC 1,385,000,000
EBIT 16,455,000,000
Tax Provision 1,015,000,000
Depreciation and Amortization 3,835,000,000
Capital Expenditure -452,000,000
Unlevered Free Cash Flow 20,116,699,079
Current Assets 18,504,000,000
Current Cash 12,416,000,000
Current Liabilities 7,052,000,000
Current Debt 440,000,000
Non-Cash Working Capital (NCWC) -524,000,000
Change in NCWC 1,044,000,000
EBIT 14,287,000,000
Tax Provision 939,000,000
Depreciation and Amortization 4,984,000,000
Capital Expenditure -424,000,000
Unlevered Free Cash Flow 18,812,063,776
Current Assets 16,586,000,000
Current Cash 12,163,000,000
Current Liabilities 6,281,000,000
Current Debt 290,000,000
Non-Cash Working Capital (NCWC) -1,568,000,000
Change in NCWC -301,000,000
EBIT 8,684,000,000
Tax Provision 29,000,000
Depreciation and Amortization 6,041,000,000
Capital Expenditure -443,000,000
Unlevered Free Cash Flow 13,943,773,688
Current Assets 11,895,000,000
Current Cash 7,618,000,000
Current Liabilities 6,371,000,000
Current Debt 827,000,000
Non-Cash Working Capital (NCWC) -1,267,000,000
Change in NCWC -2,017,000,000
EBIT 4,247,000,000
Tax Provision -518,000,000
Depreciation and Amortization 6,905,000,000
Capital Expenditure -463,000,000
Unlevered Free Cash Flow 8,672,000,000
Current Assets 9,917,000,000
Current Cash 5,055,000,000
Current Liabilities 6,899,000,000
Current Debt 2,787,000,000
Non-Cash Working Capital (NCWC) 750,000,000
Change in NCWC -1,727,000,000
EBIT 4,257,000,000
Tax Provision -510,000,000
Depreciation and Amortization 5,808,000,000
Capital Expenditure -432,000,000
Unlevered Free Cash Flow 7,906,000,000
Current Assets 9,107,000,000
Current Cash 4,292,000,000
Current Liabilities 2,338,000,000
Current Debt 0
Non-Cash Working Capital (NCWC) 2,477,000,000
Change in NCWC 270,000,000
EBIT 5,458,000,000
Tax Provision -8,084,000,000
Depreciation and Amortization 4,081,000,000
Capital Expenditure -635,000,000
Unlevered Free Cash Flow 9,174,000,000
Current Assets 15,823,000,000
Current Cash 11,204,000,000
Current Liabilities 2,529,000,000
Current Debt 117,000,000
Non-Cash Working Capital (NCWC) 2,207,000,000
Change in NCWC 803,000,000
EBIT 2,689,000,000
Tax Provision 35,000,000
Depreciation and Amortization 4,737,000,000
Capital Expenditure -1,069,000,000
Unlevered Free Cash Flow 7,108,430,136
Current Assets 7,125,000,000
Current Cash 3,097,000,000
Current Liabilities 3,078,000,000
Current Debt 454,000,000
Non-Cash Working Capital (NCWC) 1,404,000,000
Change in NCWC 545,000,000
EBIT 1,829,000,000
Tax Provision 642,000,000
Depreciation and Amortization 3,042,000,000
Capital Expenditure -723,000,000
Unlevered Free Cash Flow 4,693,000,000
Current Assets 3,775,000,000
Current Cash 1,843,000,000
Current Liabilities 1,119,000,000
Current Debt 46,000,000
Non-Cash Working Capital (NCWC) 859,000,000
Change in NCWC -378,000,000
EBIT 1,776,000,000
Tax Provision 76,000,000
Depreciation and Amortization 962,000,000
Capital Expenditure -593,000,000
Unlevered Free Cash Flow 1,674,991,820
Current Assets 3,835,000,000
Current Cash 1,628,000,000
Current Liabilities 1,016,000,000
Current Debt 46,000,000
Non-Cash Working Capital (NCWC) 1,237,000,000
Change in NCWC 840,000,000
EBIT 600,000,000
Tax Provision 33,000,000
Depreciation and Amortization 625,000,000
Capital Expenditure -409,000,000
Unlevered Free Cash Flow 1,598,105,263
Current Assets 1,818,000,000
Current Cash 999,000,000
Current Liabilities 423,000,000
Current Debt 1,000,000
Non-Cash Working Capital (NCWC) 397,000,000
Change in NCWC 136,000,000
EBIT 555,000,000
Tax Provision 16,000,000
Depreciation and Amortization 187,000,000
Capital Expenditure -236,000,000
Unlevered Free Cash Flow 626,366,197
Current Assets 1,691,000,000
Current Cash 1,085,000,000
Current Liabilities 346,000,000
Current Debt 1,000,000
Non-Cash Working Capital (NCWC) 261,000,000
Change in NCWC 46,000,000
EBIT 589,000,000
Tax Provision 22,000,000
Depreciation and Amortization 155,000,000
Capital Expenditure -241,000,000
Unlevered Free Cash Flow 526,849,572

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