In the rapidly evolving semiconductor industry, Broadcom Inc. (AVGO) and QUALCOMM Incorporated (QCOM) stand out as formidable players. Both companies share a common market focus on innovative technologies that drive connectivity and communication. Broadcom excels in infrastructure software and semiconductor solutions, while QUALCOMM pioneers advancements in wireless technologies like 5G. As an investor, understanding the strengths and strategies of these companies can help you make informed decisions about your portfolio. Let’s explore which of these tech giants presents the most compelling investment opportunity.
Table of contents
Company Overview
Broadcom Inc. Overview
Broadcom Inc. (AVGO) is a leading global technology company headquartered in San Jose, California, specializing in semiconductor and infrastructure software solutions. With a market capitalization of approximately $1.63T, Broadcom operates across four segments: Wired Infrastructure, Wireless Communications, Enterprise Storage, and Industrial & Other. The company designs a wide array of products used in various applications, including networking, telecommunications, and consumer electronics. The firm strives to innovate and provide robust solutions that enhance connectivity and efficiency in a digital-first world. Led by CEO Hock E. Tan, Broadcom employs around 37,000 individuals.
QUALCOMM Incorporated Overview
QUALCOMM Incorporated (QCOM) is a pioneer in the wireless technology sector, headquartered in San Diego, California. With a market cap of about $187B, the company focuses on the development and commercialization of foundational technologies for the wireless industry. QUALCOMM operates through three main segments: Qualcomm CDMA Technologies, Qualcomm Technology Licensing, and Qualcomm Strategic Initiatives. The company is integral to the advancement of mobile communications, providing integrated circuits and licensing its extensive patent portfolio. Under the leadership of CEO Cristiano Renno Amon, QUALCOMM employs around 49,000 people.
Key Similarities and Differences
Both Broadcom and QUALCOMM operate within the semiconductor industry, focusing on technology and innovation. However, their business models differ: Broadcom emphasizes a diverse product range across multiple sectors, while QUALCOMM concentrates on wireless technologies and licensing, primarily in mobile communications. This strategic distinction shapes their market positioning and growth trajectories.
Income Statement Comparison
The following table presents a comparison of the most recent income statements for Broadcom Inc. (AVGO) and QUALCOMM Incorporated (QCOM), highlighting key financial metrics.
| Metric | Broadcom Inc. (AVGO) | QUALCOMM Incorporated (QCOM) |
|---|---|---|
| Revenue | 51.57B | 44.28B |
| EBITDA | 23.88B | 14.93B |
| EBIT | 13.87B | 13.33B |
| Net Income | 5.90B | 5.54B |
| EPS | 1.27 | 5.06 |
Interpretation of Income Statement
In the latest fiscal year, Broadcom’s revenue increased significantly to 51.57B, up from 35.82B in the previous year, reflecting a robust growth trajectory. Although QUALCOMM also saw revenue rise to 44.28B, its growth has been relatively moderate compared to Broadcom. Both companies maintained stable margins, with Broadcom’s EBITDA margin reflecting operational efficiency. However, Broadcom’s net income declined to 5.90B, indicating increased expenses, while QUALCOMM’s net income also saw a slight decrease. This suggests a potential need for cost management strategies moving forward to maintain profitability amidst rising operational costs.
Financial Ratios Comparison
Below is a comparative table outlining the most recent revenue and financial ratios for Broadcom Inc. (AVGO) and QUALCOMM Incorporated (QCOM).
| Metric | AVGO | QCOM |
|---|---|---|
| ROE | 14.8% | 16.1% |
| ROIC | 10.4% | 11.1% |
| P/E | 32.7 | 17.2 |
| P/B | 8.5 | 5.7 |
| Current Ratio | 2.8 | 2.3 |
| Quick Ratio | 2.1 | 1.7 |
| D/E | 1.0 | 0.7 |
| Debt-to-Assets | 29.5% | 31.5% |
| Interest Coverage | 9.99 | 14.4 |
| Asset Turnover | 0.31 | 0.70 |
| Fixed Asset Turnover | 20.5 | 9.4 |
| Payout ratio | 68.7% | 36.4% |
| Dividend yield | 2.0% | 2.8% |
Interpretation of Financial Ratios
Both companies exhibit solid financial health, but there are notable differences. AVGO’s higher P/E and P/B ratios suggest a premium valuation, likely reflecting growth expectations. In contrast, QCOM shows a more favorable dividend payout ratio and yield, indicating a commitment to returning value to shareholders. However, AVGO’s lower debt-to-equity ratio and higher interest coverage indicate stronger risk management and financial stability. Investors should weigh these factors according to their risk tolerance and investment strategy.
Dividend and Shareholder Returns
Broadcom Inc. (AVGO) offers an annual dividend of $2.12 per share, with a payout ratio of 166.48%, indicating potential sustainability risks. In contrast, QUALCOMM Incorporated (QCOM) distributes a dividend yield of 2.10% with a payout ratio of 36.37%, reflecting a healthier balance between returns and retained earnings. Both companies engage in share buybacks, enhancing shareholder value. Overall, AVGO’s approach may raise concerns about long-term value creation, while QCOM appears to support sustainable growth.
Strategic Positioning
Broadcom Inc. (AVGO) holds a significant market share in the semiconductor sector, particularly in wired infrastructure and wireless communications. With a market cap of approximately $1.63T, it faces strong competitive pressure from QUALCOMM (QCOM), which focuses heavily on wireless technologies and has a market cap of about $187B. Both companies are navigating technological disruptions in 5G and AI, which could reshape market dynamics and require strategic adaptations to maintain their competitive edges.
Stock Comparison
In analyzing the stock movements of Broadcom Inc. (AVGO) and QUALCOMM Incorporated (QCOM) over the past year, we observe significant price fluctuations and trading dynamics that have influenced investor sentiment and market positioning.
Trend Analysis
For Broadcom Inc. (AVGO), the overall percentage change over the past year is +204.42%, indicating a bullish trend. Notably, the stock reached a high of $369.63 and a low of $104.93. However, recent performance from September 7, 2025, to November 23, 2025, shows a modest increase of 1.47%, which suggests a neutral trend during this shorter period. The trend is characterized by deceleration, with a standard deviation of 11.74 indicating some volatility.
Conversely, for QUALCOMM Incorporated (QCOM), the overall percentage change over the past year is +19.65%, which still classifies as bearish due to the price decrease. The stock has fluctuated between a high of $215.33 and a low of $127.46. In the recent analysis period from September 7, 2025, to November 23, 2025, QCOM experienced an increase of 8.26%, reflecting a neutral trend. The trend is noted for acceleration, supported by a standard deviation of 6.91, suggesting a more stable trading environment recently.
In summary, while AVGO exhibits strong overall performance, recent trends indicate a slowdown, whereas QCOM, despite a bearish overall trend, shows signs of a potential recovery in the short term.
Analyst Opinions
Recent analyst recommendations indicate a favorable outlook for both Broadcom Inc. (AVGO) and QUALCOMM Incorporated (QCOM). Analysts have rated AVGO with a “B” and QCOM with a “B+”, reflecting solid financial metrics, particularly in return on equity and return on assets. Notably, the debt-to-equity ratios for both companies suggest manageable leverage. The consensus for AVGO is a “buy,” while QCOM also leans toward a “buy.” Analysts are optimistic about growth prospects and market position, making these companies attractive options for investors this year.
Stock Grades
In the current market, I have analyzed stock grades from reliable grading companies for two prominent tech firms: Broadcom Inc. and QUALCOMM Incorporated. Below are the detailed ratings for each company.
Broadcom Inc. Grades
| Grading Company | Action | New Grade | Date |
|---|---|---|---|
| Mizuho | maintain | Outperform | 2025-10-21 |
| UBS | maintain | Buy | 2025-10-14 |
| Morgan Stanley | maintain | Overweight | 2025-10-14 |
| Deutsche Bank | maintain | Buy | 2025-10-14 |
| Citigroup | maintain | Buy | 2025-10-14 |
| Barclays | maintain | Overweight | 2025-10-14 |
| Keybanc | maintain | Overweight | 2025-09-30 |
| Mizuho | maintain | Outperform | 2025-09-12 |
| Argus Research | maintain | Buy | 2025-09-08 |
| Oppenheimer | maintain | Outperform | 2025-09-05 |
QUALCOMM Incorporated Grades
| Grading Company | Action | New Grade | Date |
|---|---|---|---|
| Rosenblatt | maintain | Buy | 2025-11-06 |
| B of A Securities | maintain | Buy | 2025-11-06 |
| Mizuho | maintain | Outperform | 2025-11-06 |
| UBS | maintain | Neutral | 2025-11-06 |
| Piper Sandler | maintain | Overweight | 2025-11-06 |
| Wells Fargo | maintain | Underweight | 2025-11-06 |
| JP Morgan | maintain | Overweight | 2025-11-04 |
| Citigroup | maintain | Neutral | 2025-10-28 |
| Rosenblatt | maintain | Buy | 2025-10-28 |
| UBS | maintain | Neutral | 2025-10-27 |
The overall trend for Broadcom shows consistent support with maintain ratings across multiple firms, indicating stable confidence in the stock’s performance. QUALCOMM, on the other hand, has mixed sentiments, with several maintain ratings but also some underweight assessments, suggesting a cautious outlook among analysts.
Target Prices
Currently, there are reliable target price estimates from analysts for Broadcom Inc. (AVGO) and QUALCOMM Incorporated (QCOM).
| Company | Target High | Target Low | Consensus |
|---|---|---|---|
| Broadcom Inc. (AVGO) | 460 | 295 | 399.9 |
| QUALCOMM Incorporated (QCOM) | 210 | 165 | 190 |
The overall analyst expectations indicate that Broadcom is projected to reach a consensus target price of 399.9, while QUALCOMM’s target consensus is set at 190. Both companies’ target prices suggest potential upside from their current trading levels, with AVGO priced at 347.08 and QCOM at 174.595.
Strengths and Weaknesses
In this section, I will evaluate the strengths and weaknesses of Broadcom Inc. (AVGO) and QUALCOMM Incorporated (QCOM) to assist investors in making informed decisions.
| Criterion | Broadcom Inc. (AVGO) | QUALCOMM Incorporated (QCOM) |
|---|---|---|
| Diversification | High – multiple segments in semiconductors and software | Moderate – focused on wireless technologies |
| Profitability | Strong – Net Profit Margin: 39.3% | Moderate – Net Profit Margin: 20.2% |
| Innovation | High – continuous investment in R&D | High – strong focus on 5G and AI technologies |
| Global presence | Extensive – operates in multiple countries | Extensive – significant global reach |
| Market Share | Strong – leading player in semiconductors | Strong – major player in wireless communications |
| Debt level | Moderate – Debt to Equity Ratio: 1.65 | Low – Debt to Equity Ratio: 0.70 |
Key takeaways indicate that both companies exhibit strong profitability and market presence, but Broadcom shows higher diversification and innovation potential. Meanwhile, QUALCOMM demonstrates better financial leverage with lower debt levels, making it slightly less risky.
Risk Analysis
In the table below, I present a summary of potential risks associated with Broadcom Inc. (AVGO) and QUALCOMM Incorporated (QCOM).
| Metric | Broadcom Inc. | QUALCOMM Incorporated |
|---|---|---|
| Market Risk | Moderate | High |
| Regulatory Risk | High | Moderate |
| Operational Risk | Moderate | Moderate |
| Environmental Risk | Low | Moderate |
| Geopolitical Risk | High | High |
Both companies face significant market and regulatory risks, particularly due to the volatile nature of the semiconductor industry. Recent geopolitical tensions and supply chain disruptions may further exacerbate these risks.
Which one to choose?
When comparing Broadcom Inc. (AVGO) and QUALCOMM Incorporated (QCOM), both companies present compelling fundamentals. AVGO boasts a higher gross profit margin of 63.03% compared to QCOM’s 55.43%, indicating operational efficiency. However, QCOM shows a more favorable price-to-earnings ratio of 18.71 versus AVGO’s 133.17, suggesting it may be undervalued relative to earnings.
In terms of analyst ratings, both companies hold a grade of B, but QCOM edges out with a B+ rating. Stock trends depict AVGO as bullish with a 204.42% price increase over the past year, while QCOM’s trend is bearish, reflecting a 19.65% increase.
Recommendation: Growth-focused investors might lean towards AVGO due to its strong price movement, while those valuing stability may prefer QCOM for its solid fundamentals and lower valuation metrics.
Be cautious of industry competition and market dependence risks inherent to both companies.
Disclaimer: This article is not financial advice. Each investor is responsible for their own investment decisions.
Go further
I encourage you to read the complete analyses of Broadcom Inc. and QUALCOMM Incorporated to enhance your investment decisions:
