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I’ll cover the following topics:

1. Broadcom, AVGO, soars 14% after Q4 earnings. Raises quarterly dividend.

2. Top Dividend Growth Stocks Are Selling Off

Let’s do this!

Earnings News

AVGO Stock Booms 14% After Q4 Earnings

Key Highlights:

• Record Revenue: Broadcom reported a record revenue of $51.6 billion for fiscal 2024, marking a 44% increase year-over-year. This growth was significantly driven by the acquisition of VMware and growth in AI-related semiconductor revenue.

• Q4 2024 Performance:

  • Revenue: $14.1 billion, up 51% year-over-year. Excluding VMware, organic growth was 11%.

  • EPS: GAAP diluted EPS was $0.90, and non-GAAP diluted EPS was $1.42.

  • Free Cash Flow: Generated $5.482 billion

• Q4 Segment Performance:

  • Infrastructure Software: Revenue of $5.8 billion, up 196% year-over-year. VMware's annualized booking value (ABV) reached $2.7 billion in Q4.

  • Semiconductor Solutions: Revenue of $8.23 billion. AI-related revenue grew 150% year-over-year to $3.7 billion, while non-AI semiconductor revenue declined 23% year-over-year.

• Dividend Increase: Broadcom declares $0.59/share quarterly dividend, 11.3% increase from prior dividend of $0.53.

Future Outlook:

• Q1 2025 Guidance:

  • Revenue: Projected at $14.6 billion.

  • Semiconductor Revenue: Expected to be $8.1 billion, up approximately 10% year-over-year.

  • Infrastructure Software Revenue: Expected to be $6.5 billion, up 41% year-over-year.

  • Adjusted EBITDA: Guidance of around 66% of projected revenue.

• AI Market Opportunity: Broadcom sees a significant opportunity in AI, with a serviceable addressable market (SAM) of $60-90 billion for its hyperscale customers by fiscal 2027. This is expected to drive rapid growth in the semiconductor business, outpacing the non-AI semiconductor segment.

Stock Analysis

Top Dividend Growth Stocks Are Selling Off

In my latest video, I covered a handful of companies reporting earnings—some with surprising sell-offs that might present solid buying opportunities. Let’s dig into a few highlights.

Nordson (NDSN):

Nordson, a dividend aristocrat with over 25 years of consecutive dividend growth, dropped nearly 9% after announcing results.

Nordson’s largest business segment saw a slight decline, and next year’s outlook was cautious. Still, with a robust history of rising payouts and improved dividend yield, this dip could be a chance to pick up a quality dividend grower at a discount.

Adobe (ADBE):

Adobe fell about 13%, even though it beat expectations and delivered strong free cash flow growth.

While it doesn’t pay a dividend, Adobe’s dependable subscription model and high profitability suggest this sell-off might offer an attractive entry point. Keep it on your watchlist if you’re open to non-dividend tech leaders.

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— Zach

Disclaimer: Dividend Dividend (Dividend Data LLC) is not a professional financial service. All materials released from Dividend Data (Dividend Data LLC) are for educational and entertainment purposes. Dividend Data (Dividend Data LLC) is not a replacement for a professional's opinion. Contributors to the Dividend Data (Dividend Data LLC) might have equities mentioned in the newsletter