Broadcom Stock Slumps Ahead Of Quarterly Earnings Due

If you’re looking for stocks that are setting up in a base ahead of earnings, here’s one that fits the bill: Broadcom (AVGO). It’s expected to report on Jun. 2 and is trading about 16% under a 645.41 buy point. The pattern is a third-stage cup with handle, which involves more risk than a first- or second-stage formation. On Thursday, the semiconductor stock dipped below its 200-day moving average.

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Keep in mind that buying just before a stock reports is risky, since disappointing numbers could send it sharply lower. You can reduce your exposure by waiting to see the actual numbers and the market’s reaction. You can also use an options strategy to limit your potential downside.

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Will Broadcom’s Growth Continue?

Earnings grew 27% last quarter, up from 23% in the prior report. Revenue also increased, from 15% to 16%.

Consensus analyst estimates call for earnings growth of 31% for the quarter, and 27% growth for the full year. Annual EPS estimates were recently revised higher.

Broadcom stock has a 92 Composite Rating and earns the No. 1 rank among its peers in the Electronics-Semiconductor Fabless industry group. Monolithic Power Systems (MPWR) and Advanced Micro Devices (AMD) are also among the group’s highest-rated stocks.

Note: Dates for earnings reports are subject to change. Check the company’s website for any updates.

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