NEW YORK ( TheStreet) -- With the ongoing weakness in the semiconductor space, it's starting to look as though this group has been tiered off between the "haves," where Qualcomm (QCOM) resides and the "have nots", a space occupied by Intel (INTC).
It's now clear that Broadcom's (BRCM) has reached the ranks of the "haves." It's hard to ignore the company's strong market position as one of the best part suppliers in a growing mobile industry. And after a solid Q4 earnings results, Broadcom has shown no indication of slowing growth. Although the stock is not cheap, there's plenty of momentum here to produce more gains.
The downbeat guidance not withstanding, the chip giant delivered a strong Q4 with revenue growing at 14% year-over-year to $2.08 billion. Although it was a 2% sequential decline, it was good enough to beat analysts' consensus estimate of $2.07 billion. Net income arrived at $251 million, or 43 cents per share -- beating analysts' projections by 4 cents.
The company logged strong revenue numbers in each of its three segments -- helping boost cash flow to record levels. However, the 2% sequential revenue dip was a bit of a surprise, especially since rival Qualcomm just boasted a 24% sequential improvement with chip revenue growing 34%.It stands to reason that Broadcom ceded market share to Qualcomm during the quarter. Then again, whatever market share Broadcom is losing to Qualcomm, the company is offsetting by taking it from the likes of Texas Instruments (TXN), which just reported another horrid quarter, during which revenue dropped 12% sequentially and 13% year-over-year. For Texas Instruments this marked the fifth consecutive quarter of declining revenue. And the company is not expecting much sequential improvement as it issued revenue guidance that represents 6% decline. Broadcom is also outperforming Intel -- even Intel seems to be on a verge of a comeback after posting Q4 revenue of $13.477 billion.
However, it still missed estimates -- albeit by less than 1%. Then again, considering how down and out Intel has been in this race, its recent quarter qualified as a win. But not nearly enough to best Broadcom's performance, which grew gross margins sequentially by 10 basis points and by almost 2 points year-over-year.
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV