NASDAQ · Technology

Broadcom Inc.

AVGO · Semiconductors

$411.35

▲ 18.45 (4.7%)

Cached · 10 min

Overall Grade

Defensive

Enterprising

Profitability

A⤢

Gross Profit Margin 69.5%

Operating Margin 48.9%

Net Income Margin 42.0%

Fin. Health

D⤢

Years to Pay Off Debt 7.0 yrs

Working Capital vs Long-Term Debt -$39.3B

Working Capital $23.4B

Valuation

F⤢

Margin of Safety 0.0%

Price-to-Book 22.32x

Cash Flow

A⤢

Free Cash Flow $10.3B

CapEx % of Net Income 2.5%

Owner Earnings $11.7B

Profitability

Gross Profit Margin 69.5%

Revenue minus cost of goods sold. Graham's ≥40% threshold identifies businesses with durable pricing power. Note: software and financial companies naturally exceed this; retailers and manufacturers rarely reach it due to their cost structures.

Operating Margin 48.9%

Profit after operating costs before interest and taxes. A consistent ≥15% operating margin signals a business with real competitive advantages. Capital-intensive industries (airlines, auto, commodities) rarely hit this threshold due to their structural cost base — compare within industry for context.

Net Income Margin 42.0%

Bottom-line profit as a percentage of revenue. The ≥20% target reflects Buffett's preference for highly profitable businesses. Financial engineering (buybacks, tax optimisation) can inflate this temporarily — look for consistency across multiple years rather than a single strong result.

Financial Health

Years to Pay Off Debt 7.0 yrs

Total Debt ÷ Net Income. Lower = stronger balance sheet. Important caveat: utilities, telecoms, REITs, and infrastructure companies carry large structural debt by design — their bond-like cash flows service it comfortably at ratios that would alarm Graham. Compare within sector.

Working Capital vs Long-Term Debt -$39.3B

Working Capital minus Long-Term Debt. Negative results are common and expected in capital-return-focused businesses like Apple, Domino's, and McDonald's — where aggressive buybacks and dividends intentionally reduce book equity. This does not indicate financial distress in high-FCF businesses.

Working Capital $23.4B

Current Assets minus Current Liabilities. Negative working capital can be a deliberate efficiency strategy in businesses that collect cash before paying suppliers (retailers, fast food franchises, subscription businesses). Assess alongside free cash flow generation for full context.

Cash Flow

Free Cash Flow $10.3B

Operating cash flow minus capital expenditures. Buffett's most important metric — cash a business actually generates for its owners after maintaining and growing its asset base. Consistently positive FCF is one of the strongest indicators of a durable, well-run business regardless of accounting profits.

CapEx % of Net Income 2.5%

Capital expenditure as a share of net income. Low CapEx signals a capital-light business that doesn't need heavy reinvestment to sustain earnings — Buffett's ideal. High CapEx is structurally necessary in manufacturing, airlines, telecoms, and semiconductors. For these industries, a high reading reflects the business model, not poor management.

Owner Earnings $11.7B

Net Income + Depreciation & Amortisation − Capital Expenditures. Buffett's preferred measure of a company's true annual earning power — what could theoretically be distributed to owners without impairing the business. More reliable than reported EPS because it accounts for the capital cost of maintaining the business.

Defensive — Graham's strict criteria (P/B, P/E, dividends, stability) · Enterprising — Profitability & cash flow focused, accepts higher valuations for quality

About Broadcom Inc.

Broadcom Inc. designs, develops, and supplies various semiconductor devices and infrastructure software solutions internationally. The company operates in two segments: Semiconductor Solutions and Infrastructure Software. The company offers networking connectivity, such as custom silicon solutions, ethernet switching & routing, ethernet NIC controllers, physical layer devices, and fiber optic components; wireless device connectivity, including RF semiconductor devices, connectivity solutions, custom touch controllers, and inductive charging ASICS; servers and storage system solutions, such as PCIE switches, SAS & raid products, fibre channel products, and HDD & SSD solutions; broadband solutions, includes set-top box, and broadband access; and industrial. The company also offers a private cloud software portfolio, including the VMware Cloud Foundation, Edge, vSphere foundation, telco cloud platform, private AI, live recovery, application networking and security, application development and data services; mainframe software, such as AIOPS & automation, database & data management, DEVX & DEVOPS, cybersecurity & compliance management, beyond code programs, foundational & open mainframe solutions; cybersecurity, such as endpoint, network, information, application security, and identity & access management; enterprise software; and fc san management. Its products are used in various applications in enterprise and data center networking, including artificial intelligence networking and connectivity, home connectivity, set-top boxes, broadband access, telecommunication equipment, wireless device and base stations, data center servers and storage systems, factory automation, power generation and alternative energy systems, and electronic displays. Broadcom Inc. was founded in 1961 and is headquartered in Palo Alto, California.

Market Data

Market Cap $1,957.0B

Enterprise Value $1,837.5B

P/E (TTM) 68.22

Dividend Yield 0.65%

Exchange NASDAQ

Key Margins

Gross Profit 69.5%

Operating Margin 48.9%

Net Margin 42.0%

Company Info

Sector Technology

Industry Semiconductors

Employees 33000

Country United States

Visit website

📖

Full Graham Analysis

Mr. Market is currently offering Broadcom Inc. at $411.35.

The business passes only 3 of 7 of Graham's defensive criteria — well below his required standard.

At $411.35, the stock trades at a 1362% premium to its Graham Number of $28.14. Graham would consider this price speculative.

There is no margin of safety at the current price. Graham would advise patience and waiting for a better entry point.

Negative NCAV — liabilities exceed current assets. Common in capital-return businesses (buybacks, debt-funded dividends) and capital-intensive industries. Not automatically a warning sign..

Conclusion: By Graham's standards, this stock is speculative at its current price. The intelligent investor would look elsewhere or wait.

Showing Key Metrics

Income Highlights

Metric	Q2 2026	Q4 2025	Q4 2024
Gross Profit %	69.5%▲	68.0%•	N/A
Operating Margin %	48.9%▲	42.5%•	N/A
Net Income %	42.0%▼	47.3%•	N/A
Diluted EPS	1.91▲	1.74•	N/A

Balance Sheet Highlights

Metric	Q2 2026	Q4 2025	Q4 2024
Total Assets	$179.2B	$171.1B	N/A
Total Debt	$64.9B▼	$65.1B•	N/A
Working Capital	$23.4B▲	$13.1B•	N/A
Years to Pay Debt	6.97	7.65	N/A

Cash Flow Highlights

Metric	Q2 2026	Q4 2025	Q4 2024
Free Cash Flow	$10.3B▲	$7.5B•	N/A
Owner Earnings	$11.7B	$11.0B	N/A
CapEx % of Net Income	2.5%	2.8%	N/A

Income Statement

	2026	2025	2024
Tax Effect Of Unusual Items	-5,747	-34,230
Tax Rate For Calcs	0	0
Normalized EBITDA	13,142,000	10,026,000
Total Unusual Items	-71,000	-163,000
Total Unusual Items Excluding Goodwill	-71,000	-163,000
Net Income From Continuing Operation Net Minority Interest	9,310,000	8,518,000
Reconciled Depreciation	2,165,000	2,233,000
Reconciled Cost Of Revenue	5,113,000	4,040,000
EBITDA	13,071,000	9,863,000
EBIT	10,906,000	7,630,000
Net Interest Income	-776,000	-414,000
Interest Expense	776,000	761,000
Normalized Income	9,375,253	8,646,770
Net Income From Continuing And Discontinued Operation	9,310,000	8,518,000
Total Expenses	11,328,000	10,361,000
Total Operating Income As Reported	10,788,000	7,508,000
Diluted Average Shares	4,876,000	4,889,000
Basic Average Shares	4,747,000	4,732,000
Diluted EPS	0	0
Basic EPS	0	0
Diluted NI Availto Com Stockholders	9,310,000	8,518,000
Net Income Common Stockholders	9,310,000	8,518,000
Net Income	9,310,000	8,518,000
Net Income Including Noncontrolling Interests	9,310,000	8,518,000
Net Income Discontinuous Operations		0	119,000
Net Income Continuous Operations	9,310,000	8,518,000
Tax Provision	820,000	-1,649,000
Pretax Income	10,130,000	6,869,000
Other Income Expense	47,000	-371,000
Other Non Operating Income Expenses	118,000	-208,000
Special Income Charges	-71,000	-146,000
Restructuring And Mergern Acquisition	71,000	146,000
Net Non Operating Interest Income Expense	-776,000	-414,000
Interest Expense Non Operating	776,000	761,000
Operating Income	10,859,000	7,654,000
Operating Expense	4,556,000	4,595,000
Depreciation Amortization Depletion Income Statement	506,000	507,000
Depreciation And Amortization In Income Statement	506,000	507,000
Amortization	506,000	507,000
Amortization Of Intangibles Income Statement	506,000	507,000
Research And Development	2,995,000	2,981,000
Selling General And Administration	1,055,000	1,107,000
Gross Profit	15,415,000	12,249,000
Cost Of Revenue	6,772,000	5,766,000
Total Revenue	22,187,000	18,015,000
Operating Revenue	22,187,000	18,015,000

Balance Sheet

	2026	2025	2024
Ordinary Shares Number	4,758,000	4,741,000
Share Issued	4,758,000	4,741,000
Net Debt	45,279,000	48,958,000
Total Debt	64,907,000	65,136,000
Tangible Book Value	-38,443,000	-48,782,000
Invested Capital	152,598,000	146,428,000
Working Capital	23,351,000	13,059,000
Net Tangible Assets	-38,443,000	-48,782,000
Capital Lease Obligations		0	39,000
Common Stock Equity	87,691,000	81,292,000
Total Capitalization	150,346,000	143,276,000
Total Equity Gross Minority Interest	87,691,000	81,292,000
Stockholders Equity	87,691,000	81,292,000
Gains Losses Not Affecting Retained Earnings	208,000	218,000
Other Equity Adjustments	208,000	218,000
Retained Earnings	12,166,000	9,761,000
Additional Paid In Capital	75,312,000	71,308,000
Capital Stock	5,000	5,000
Common Stock	5,000	5,000
Total Liabilities Net Minority Interest	91,467,000	89,800,000
Total Non Current Liabilities Net Minority Interest	72,605,000	71,286,000
Other Non Current Liabilities	2,469,000	1,423,000
Tradeand Other Payables Non Current	1,662,000	1,628,000
Non Current Deferred Liabilities	5,819,000	6,251,000
Non Current Deferred Revenue	4,204,000	3,547,000
Non Current Deferred Taxes Liabilities	1,615,000	2,704,000
Long Term Debt And Capital Lease Obligation	62,655,000	61,984,000
Long Term Capital Lease Obligation		0	13,000
Long Term Debt	62,655,000	61,984,000
Current Liabilities	18,862,000	18,514,000
Other Current Liabilities	1,228,000	663,000
Current Deferred Liabilities	10,038,000	9,469,000
Current Deferred Revenue	10,038,000	9,469,000
Current Debt And Capital Lease Obligation	2,252,000	3,152,000
Current Capital Lease Obligation		0	26,000
Current Debt	2,252,000	3,152,000
Other Current Borrowings	2,252,000	3,152,000
Commercial Paper
Pensionand Other Post Retirement Benefit Plans Current	1,134,000	2,129,000
Payables And Accrued Expenses	4,210,000	3,101,000
Current Accrued Expenses	656,000	620,000
Interest Payable	656,000	620,000
Payables	3,554,000	2,481,000
Total Tax Payable	1,217,000	921,000
Accounts Payable	2,337,000	1,560,000
Total Assets	179,158,000	171,092,000
Total Non Current Assets	136,945,000	139,519,000
Other Non Current Assets	8,023,000	6,915,000
Goodwill And Other Intangible Assets	126,134,000	130,074,000
Other Intangible Assets	28,333,000	32,273,000
Goodwill	97,801,000	97,801,000
Net PPE	2,788,000	2,530,000
Accumulated Depreciation		-4,896,000	-4,504,000
Gross PPE		7,426,000	7,025,000
Construction In Progress		78,000	57,000
Machinery Furniture Equipment		5,656,000	5,246,000
Buildings And Improvements		1,488,000	1,518,000
Land And Improvements		204,000	204,000
Current Assets	42,213,000	31,573,000
Other Current Assets	369,000	457,000
Prepaid Assets	1,140,000	518,000
Inventory	4,328,000	2,270,000
Finished Goods	1,858,000	682,000
Work In Process	1,801,000	1,280,000
Raw Materials	669,000	308,000
Receivables	16,748,000	12,150,000
Other Receivables	5,918,000	5,005,000
Accounts Receivable	10,830,000	7,145,000
Allowance For Doubtful Accounts Receivable		-74,000	-101,000
Gross Accounts Receivable		7,219,000	4,517,000
Cash Cash Equivalents And Short Term Investments	19,628,000	16,178,000
Cash And Cash Equivalents	19,628,000	16,178,000

Cash Flow

	2026	2025	2024
Free Cash Flow	10,262,000	7,466,000
Repurchase Of Capital Stock	-600,000	0
Repayment Of Debt	-1,250,000	-3,638,000
Issuance Of Debt	0	4,483,000
Issuance Of Capital Stock		103,000	126,000
Capital Expenditure	-231,000	-237,000
Interest Paid Supplemental Data	695,000	699,000
Income Tax Paid Supplemental Data	1,099,000	755,000
End Cash Position	19,628,000	16,178,000
Beginning Cash Position	14,174,000	10,718,000
Changes In Cash	5,454,000	5,460,000
Financing Cash Flow	-4,831,000	-1,876,000
Cash Flow From Continuing Financing Activities	-4,831,000	-1,876,000
Net Other Financing Charges	-2,000	-27,000
Cash Dividends Paid	-3,092,000	-2,797,000
Common Stock Dividend Paid	-3,092,000	-2,797,000
Net Common Stock Issuance	-487,000	103,000
Common Stock Payments	-600,000	0
Common Stock Issuance		103,000	126,000
Net Issuance Payments Of Debt	-1,250,000	845,000
Net Short Term Debt Issuance	0
Short Term Debt Issuance	0
Net Long Term Debt Issuance	-1,250,000	1,333,000
Long Term Debt Payments	-1,250,000	-3,638,000
Long Term Debt Issuance	0	4,971,000
Investing Cash Flow	-208,000	-367,000
Cash Flow From Continuing Investing Activities	-208,000	-367,000
Net Other Investing Changes	7,000	105,000
Net Investment Purchase And Sale	16,000	-235,000
Sale Of Investment	39,000	101,000
Purchase Of Investment	-23,000	-336,000
Net Business Purchase And Sale		0	0
Net PPE Purchase And Sale	-231,000	-237,000
Purchase Of PPE	-231,000	-237,000
Operating Cash Flow	10,493,000	7,703,000
Cash Flow From Continuing Operating Activities	10,493,000	7,703,000
Change In Working Capital	-2,572,000	-2,345,000
Change In Other Working Capital	1,015,000	-1,722,000
Change In Payables And Accrued Expense	149,000	118,000
Change In Payable	149,000	118,000
Change In Account Payable	149,000	118,000
Change In Inventory	-1,366,000	-90,000
Change In Receivables	-2,370,000	-651,000
Changes In Account Receivables	-2,370,000	-651,000
Other Non Cash Items	70,000	107,000
Stock Based Compensation	2,092,000	2,195,000
Deferred Tax	-603,000	-3,025,000
Deferred Income Tax	-603,000	-3,025,000
Depreciation Amortization Depletion	2,165,000	2,233,000
Depreciation And Amortization	2,165,000	2,233,000
Amortization Cash Flow	2,002,000	2,085,000
Amortization Of Intangibles	2,002,000	2,085,000
Depreciation	163,000	148,000
Operating Gains Losses	31,000	20,000
Net Income From Continuing Operations	9,310,000	8,518,000

📊 Quarterly mode — Graham Fair Value & 7 Criteria require annual data. Switch to Annual for full analysis.

Quarter vs Same Quarter Last Year

YoY strips seasonality

Revenue Growth (YoY)

Prior year: $15.0B ▲ $22.2B +47.9%

Revenue growth vs same quarter last year strips seasonality. Consistent double-digit growth is a Buffett hallmark.

Gross Margin

Prior year: 68.0% ▲ 69.5% +1.5pp

Buffett: consistent gross margin above 40% signals durable pricing power and competitive moat.

Operating Margin

Prior year: 72.4% ▲ 48.9% -23.4pp

Graham: operating margin reflects true business economics before financing. Trend matters as much as level.

Net Margin

Prior year: 33.1% ▲ 42.0% +8.9pp

Net margin can be distorted by one-time items, tax timing, or interest costs — compare to operating margin for signal quality.

Quarterly Health Checks

3 Graham/Buffett criteria that are valid and reliable on quarterly data

✅ Adequate Size

Graham required scale for resilience. Quarterly revenue × 4 gives an annualised proxy.

$22.2B/qtr (≈$88.7B ann.)

vs > $1.5B annualised revenue

✅ Financial Condition

Current assets vs current liabilities — a real-time liquidity snapshot. Valid and reliable on quarterly data.

2.24x current ratio

vs ≥ 2.0x

✅ Free Cash Flow

Buffett's most important single metric. A positive FCF quarter means the business generated real cash for owners after maintaining its asset base.

$10.3B

vs Positive

Operating Cash Flow

$10.5B

Latest quarter · Buffett's cash reality check

ROIC

5.4%

Based on latest annual operating income

Return on Invested Capital — Buffett's preferred measure for asset-light businesses. ROIC > 15% consistently signals a durable competitive advantage (moat). More meaningful than P/B for software, pharma, and consumer brand companies where most value is intangible and off-balance-sheet.

Market Cap / Net Assets

22.3x

Net Assets: $87.7B

Asset Context — Semiconductors

This company's primary assets are likely intangible (brand, IP, talent, network effects) and don't appear on the balance sheet. Net Assets may significantly understate intrinsic value. ROIC and free cash flow are more reliable indicators of business quality.

⚠️ Revenue grew vs prior year but operating margin contracted. Possible explanations: deliberate investment in growth (hiring, marketing, R&D), input cost inflation, or pricing pressure from competition. Buffett distinguishes between spending that builds moat vs. spending that doesn't.

Peers & Industry Comparison

Semiconductors — Auto-detected peers

Company	Price	Market Cap	P/E	Gross Margin	Net Margin	Revenue
AVGO	$411.35	$1,957.0B	68.22	69.5%	42.0%	$22.2B
NVDA NVIDIA Corporation	$210.69	$5,103.1B	32.3	74.1%	63.0%	$253.5B
AMD Advanced Micro Devices, Inc.	$537.37	$876.2B	179.7	53.1%	13.4%	$37.5B
INTC Intel Corporation	$133.99	$673.4B	N/A	37.2%	-5.9%	$53.8B
QCOM QUALCOMM Incorporated	$226.11	$238.3B	24.3	54.8%	22.3%	$44.5B

"The management of a business is its most important single factor — more important than market position, patents, or financial structure."

— Benjamin Graham

Capital Allocation & Alignment

Insider Ownership

1.94%

Low — management has little skin in the game

Return on Equity (ROE)

10.6%

Adequate — returns are moderate

Return on Assets (ROA)

5.2%

Strong — management uses assets efficiently

Share Buybacks (Latest Year)

$6.3B

Management is returning capital to shareholders via buybacks

Debt Trend YoY

-1.7% YoY

Debt is declining — management is deleveraging

Leadership Team

Hock Tan

President, CEO & Executive Director

Age 73

Pay: $2,926,926

0.031% of net income

Top Institutional Holders

Institution	% Owned	Shares
Blackrock Inc.	8.11%	385,944,774
Vanguard Capital Management LLC	6.47%	308,015,865
State Street Corporation	4.02%	191,380,232
Vanguard Portfolio Management LLC	2.70%	128,422,947
FMR, LLC	2.61%	124,112,876
Capital World Investors	2.44%	116,188,483
Capital Research Global Investors	2.44%	116,025,298
Geode Capital Management, LLC	2.40%	114,280,922

Risk Analysis

Beta (Market Risk)

1.43

Moderate volatility — moves slightly more than market

Short Interest

1.2% of float

Low short interest — market is not heavily bearish

Debt-to-Equity

0.74x

Conservative balance sheet — low financial risk

Current Ratio

2.24x

Strong liquidity — Graham approved

52-Week Price Range

Low: $244.17 Current: $411.35 High: $495.00

Currently at 67% of 52-week range

Broadcom Inc.

Metric Explanations

Full Graham Analysis

Income Highlights

Balance Sheet Highlights

Cash Flow Highlights

Quarter vs Same Quarter Last Year

Quarterly Health Checks

Operating Cash Flow

ROIC

Market Cap / Net Assets

Peers & Industry Comparison

Capital Allocation & Alignment

Leadership Team

Top Institutional Holders

Risk Analysis