Avago Technologies (AVGO) Stock Rises After Analyst Action

NEW YORK (TheStreet) -- Avago Technologies (AVGO) stock advanced 2.25% to $132.50 after MKM Partners increased its price target to $149 from $148 and reiterated its "buy" rating for the Singapore and San Jose, CA-based designer, developer and global supplier of a range of analog semiconductor devices.

Research of Avago's end-markets suggest solid demand in support of smartphone builds and broad strength across cloud data center offsetting more problematic areas such as PC client exposure, industrial, and service provider, according to MKM Partners.
"Wireline infrastructure is favorably exposed to cloud data center deployments," said MKM analyst Ian Ing. "Not only is strength coming from the usual North American cloud service providers, but China service providers (Alibaba [BABA, Buy, $93.88, $115 PT], Baidu, Tencent), as well as Taiwan white-box vendors (Quanta Cloud Technology), which are increasingly important customers."
Strength in radio frequency and data center technology should be more than sufficient to overcome weakness in PC client storage, MKM noted.
Separately, Avago reports fiscal second quarter earnings results on Thursday, May 28, after the market close.

TheStreet Ratings team rates AVAGO TECHNOLOGIES LTD as a Buy with a ratings score of A-. TheStreet Ratings Team has this to say about their recommendation:

"We rate AVAGO TECHNOLOGIES LTD (AVGO) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its robust revenue growth, expanding profit margins, good cash flow from operations, increase in net income and solid stock price performance. We feel its strengths outweigh the fact that the company has had somewhat disappointing return on equity."

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