저자: ParkevTatevosian,CFA · 외국인
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브로드컴이 실적 발표 후 주가 약 12% 급락했으나, AI 반도체 매출 143% 성장(3분기 가이던스 200%+, 160억달러)과 총매출 48% 성장(222억달러), 조정 EBITDA 마진 69%, 영업이익률 67%, 영업현금흐름 대매출비 약 50%를 근거로 저평가라고 주장. 선행 PER 31배, 자체 DCF 적정가 약 500달러(현재 415달러 부근) 제시. 2026년 6월 4일 매수 의견 재확인.
다듬은 글
Broadcom reported quarterly financial results that are sending the stock price crashing. On the day after the report, the stock price is down 12% as I'm recording. Investors want to know, why is the price crashing and is this a buying opportunity? I'll answer those questions in this video. you can see the day after I'm recording the video, it's down 11.83% as the shares are falling in one of the biggest one-day declines in Broadcom's history, especially if you look at it on a market capitalization basis.
But if we zoom out and we look at the year-to-date results, even after today's decline, Broadcom stock is still up over 19% and if we zoom out further and we look at the one-year return, it's up almost 58%. So already right off the bat, we can see one of the reasons why Broadcom stock is falling is because expectations have been lifted so significantly coming into this earnings release that the numbers have to be so spectacular as to maintain those gains.
And the numbers were really, really good and let's go over them one at a time. So in the second quarter, semiconductor revenue from artificial intelligence totaled $10.8 billion. That was up a whopping 143% year-over-year and above the company's forecast, driven by of course increasing demand for custom AI accelerators and AI networking.
Broadcom is famously working with companies like Alphabet, Meta Platforms and OpenAI to create custom-designed chips that they will use for their own purposes and to sell to third parties in the case of Alphabet. The momentum continues and the management is expecting in the third quarter for semiconductor revenue from AI to grow by over 200% and reach $16 billion.
So, it's not only is it growing by triple digits, 143% but they're forecasting an acceleration from a triple digit revenue growth rate. I mean, that's spectacular. Not only is it spectacular to have a triple digit year-over-year growth when you're a company the size of Broadcom with a segment that's generating billions, over $10 billion in revenue but to grow and accelerate from that base is remarkable.
The scope and size of this buildout is truly unprecedented and it just keeps going forward. Overall revenue in the second quarter for the company, not just that one segment grew 48% to a record $22.2 billion. Adjusted EBITDA, which is a measure of profitability increased 52% year-over-year to a record $15.2 billion representing 69% of revenue.
That's an incredibly lucrative business model, very high profit margins on every single dollar of revenue and that's partly due to the business model. Broadcom is an asset light business model. It designs the semiconductors but most of the manufacturing is outsourced and so that allows the company to generate very high profit margins with limited capital investment, the precise business model that Wall Street loves.
So, in the third quarter they're expecting consolidated revenue to increase to 84%. So, more acceleration expected even consolidated basis, not just on a segment specific basis. 84% revenue growth for a company that's generating over $20 billion in revenue. That's very impressive. The non-GAAP operating profit margin is expected to remain stable at 67% year-over-year.
An operating [snorts] profit margin of 67% would place Broadcom among the best of the best in terms of operating profit ability of all of the companies that I'm following, right? I believe right now, and the lead has been changing. For a long time, prior to 2026, Visa had been the number one in terms of operating profit margin at around 65% for the previous decade.
Visa's operating margin had been up there, and it had been the leader in all of the companies that I've been following before, let's say 2025. And then, we started to get these semiconductor companies with their profit margins soaring, like Nvidia and Broadcom and a few others that are seeing their profit margins soar as a result of soaring revenue, and Broadcom is now up there among the leaders, might be the leader.
Now, there's a lot of changes quarter over quarter. It's not, you know, clearly Visa the number one anymore. We have some changes at the top of the leaderboard in terms of operating profit margin due to this boom in artificial intelligence. So, it's not just revenue and profits that are increasing. Their cash flow is actually increasing as well.
This is something you also want to confirm when you're evaluating a company with this kind of boom in business. You want to confirm that their cash flow is also increasing. In some cases, there are companies with booming revenue and profits where their cash flow is not increasing. And that's a red flag in a lot of cases because it could mean that the company's revenue and profits are soaring because the company is offering attractive financing terms allowing their customers to pay them back a lot later than usual, which of course makes it an attractive purchase, a more attractive purchase.
But that's not happening at Broadcom. Cash flow from operations jumped by 60% to 10.5 billion dollars. And if you divide the cash flow from operations of 10.5 billion by the revenue of 22.1 billion, you'll notice that their cash flow from operations to sales ratio is nearly 50%. Another excellent margin, one of the best in the world at this margin for Broadcom.
So, when I see booming profit margins and profitability for a company, I want to take a look at their longer-term profitability metrics. I want to see if this company has a history of reporting excellent profits or if it's just a one-time situation right now because of booming demand. And for Broadcom, it's certainly not a one-time situation.
Broadcom's profitability and profit margins have been increasing and have been on an uptrend even before the launch of ChatGPT. You can see their cash flow from operations to sales ratio soared from 25.8% in 2016 all the way up to 50% in 2021 before ChatGPT was even launched. Their cash flow from operations and margins took a dip after the acquisition of VMware as it usually does when a company makes an acquisition of meaningful proportion.
It impacts their profit margins in the near term, and then in the longer term, if it works out well, it boosts profitability because the businesses have better economies in scale and benefit from synergies. And a lot of times investors are curious, what are those synergies? Why do businesses like to make acquisitions?
And the easiest one to talk about is just management and the infrastructure of a business, right? You think about the legal department, the accounting department, the human resources department, right? Broadcom had their own divisions, accounting, you know, legal, etc., etc. And then VMware had their own divisions, right?
And so when you make the combination, you don't need two human resources departments. You don't need two accounting departments. You don't need two board of directors. You can deal with one to manage the entire company. Maybe you onboard some of the best people from the other company that you're acquiring, but not everyone.
You don't need everyone. Because there's a lot of duplication. And so you're able to do the same amount of business or even more business as you cross-sell some of the customers with a lower cost base. And so that is one of the just most obvious ways that acquisitions lead to better profits for the combined entity versus the entities individually.
So let's take a look at valuation now. Broadcom after the sell-off is trading at a forward price to earnings of 31. So when measuring on just 1 for a company that's accelerating revenue on the top line approaching over 80% with profit margins approaching 70% and cash flow from operations approaching 50% with strong competitive advantages and asset-light business model, a multi-trillion-dollar total addressable market opportunity, I think it's a cheap valuation for a business with these characteristics to be trading at this kind of valuation.
I think is attractive. And then when I look at the valuation based on a discounted cash flow model that I customized for my own use case, it looks undervalued as well, trading at $415. I updated my intrinsic value per share uh due to increases in my estimates for what I believe the business will generate in free cash flow between today and the very long run.
I now calculate the business to be worth close to very close to $500 per share. So, it looks undervalued on my discounted cash flow model. It looks undervalued on a market multiples basis. So, overall, it looks undervalued to be sure. So, to answer the question in the headline, do I think Broadcom stock is a buying opportunity on this dip? I think so, and I created and reiterated that buy rating on June 4th, 2026.
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