In a research report released Thursday, Brean Capital analyst Mike Burton reiterated a Buy rating on shares of Avago Technologies Ltd (NASDAQ:AVGO) while reducing the price target to $170 (from $180), which represents a potential upside of 36% from where the stock is currently trading. The decreased price target was in response to multiple contraction in Semis in general. However, that analyst continues to believe that the name is too cheap with synergies to come and a world-class diversified semiconductor portfolio.
Burton wrote, “Avago reported a solid beat and guide despite market turbulence and more cautious commentary from competitors. Apple continues to drive results as the Company’s Mobile segment drove July revenues and is set up for a seasonally strong October quarter. Although the Company guided revenues slightly below consensus, gross margins and OPEX are looking better than expected, and therefore EPS guidance is ahead of the Street. We were already inline with margins so while we are adjusting our EPS slightly, our TP is coming down to $170.”
According to TipRanks.com, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Mike Burton has a total average return of 9.5% and a 47.2% success rate. Burton has a 8.0% average return when recommending AVGO, and is ranked #506 out of 3734 analysts.
Out of the 19 analysts polled by TipRanks, 17 rate Avago Technologies stock a Buy, while 2 rate the stock a Hold. With a return potential of 19%, the stock’s consensus target price stands at $148.56.