Buy This Top Chipmaker Before Tomorrow Night

The projections are looking great for tomorrow evening’s earnings report from a well-known chipmaker. Analysts are calling for 108% forecasted sales growth and 41.9% earnings growth—nearly double the industry average. On top of this, the consensus EPS estimate has jumped 5% in the past 90 days. Which company am I referring to?

I’m talking about Avago Technologies (AVGO), which is on deck to announce its fiscal third-quarter results after the close tomorrow. Based in Singapore, Avago Technologies develops and supplies analog semiconductor devices for over 40,000 customers in wireless communications, wired infrastructure and industrial markets. While AVGO went public just five years ago, it has a long history—it spent three decades as a subsidiary of Hewlett-Packard.

Today, Avago operates design centers in Asia, Europe and the U.S and manufacturing facilities primarily in Asia. About 85% of its sales come from outside the U.S. and the company is a clear beneficiary of global growth. Recently the company completed its takeover of LSI Corp and took its place on the S&P 500. Being a member of the most important U.S. benchmark index exposes the shares to ETF and index fund buying, as well as interest from active managers who focus only on the S&P 500.

My expectation is that this will be a headline-making earnings report, so I recommend AVGO as an A-rated Buy.

Sincerely,

signed: Louis Navellier

Louis Navellier

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