5 Best 5G Stocks to Buy Now

2. Broadcom Inc. (NASDAQ:AVGO)

Market Cap as of August 8: $220.928 billion

Broadcom Inc. (NASDAQ:AVGO) is an American semiconductor company. The company announced its involvement in the 5G technology in 2018 and pledged to make the US a global leader in 5G. As of 2021, the company has over 19,000 patents in its portfolio. Furthermore, according to Broadcom Inc. (NASDAQ:AVGO), 99.9% of all internet traffic crosses at least one Broadcom chip at some point.

Broadcom Inc. (NASDAQ:AVGO) has increased its dividend for the past 11 years. As of August 6, the company has a dividend yield of 2.97% with a quarterly dividend of $4.10. In Q2 2022, the company paid $1.7 billion in dividends, equal to 50% of its free cash flow. Furthermore, the company authorized a $10 billion share repurchase program through December 2023.

On July 20, Deutsche Bank analyst Ross Seymore maintained a Buy rating on Broadcom Inc. (NASDAQ:AVGO) shares and lowered the price target of the company to $635 from $700. According to the analyst, the “purgatory” state of the semiconductor cycles continues into the Q2 earnings season. Seymore is now looking to reduce revenue, earnings, and price targets by 4%, 10% and 14%, respectively, considering that he is “more actively factoring in accelerating macro/sector headwinds” in his 2023 estimates.

Here is what ClearBridge Investments had to say about Broadcom Inc. (NASDAQ:AVGO) in its Q4 2021 investor letter:

“However, ClearBridge portfolio companies are responding by supporting their workforces and showing resilience in adapting and thriving. Semiconductor companies ClearBridge owns and engages with have been successful in advancing vaccinations in their global supply chains. In Malaysia, for example, Broadcom has taken part in PIKAS, a public-private partnership vaccination program focusing on the workforce in critical manufacturing sectors. By the summer of 2021, Broadcom was able to get over 90% of workers in its Penang factory at least one dose of vaccine, and roughly 73% fully vaccinated. Companies in the program also pay the administration cost for vaccinations including cases where the employee is no longer employed by the company before full immunization of the employee.”