Markets & Finance

CIBC World Upgrades Broadcom

Broadcom (BRCM) raised its third-quarter sequential revenue growth guidance to 10%. CIBC World upgraded the stock.

Analyst James Junghohann upgraded Broadcom shares to sector outperform from sector perform with a $30 price target. He says after the company's mid-quarter update, he finally feels all the negative sentiment overhanging the company's ServerWorks division is "baked in" to 2004 estimates. He notes the company guided ServerWorks sales in 2004 to near worst case $200 million and down from $300 million estimate in 2003.

Also, Broadcom upped its third-quarter 6% to 8% sequential sales growth guidance to 10%. He believes the company will be able to replace lost ServerWorks revenues with growth in its core and emerging businesses. Junghohann raised his pro forma 40 cents 2003 EPS estimate to 41 cents, and sees 65 cents in 2004.

Steve Ballmer, Power Forward

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