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AVGO vs FORTY

AVGO
Broadcom Inc.
NEUTRAL
Price
$350.63
Market Cap
$1.66T
Sector
Technology
AI Confidence
85%
FORTY
Formula Systems (1985) Ltd.
BEARISH
Price
$124.45
Market Cap
$1.91B
Sector
Technology
AI Confidence
85%

Valuation

P/E Ratio
AVGO
68.48
FORTY
54.11
Forward P/E
AVGO
19.65
FORTY
--
P/B Ratio
AVGO
20.79
FORTY
1.4
P/S Ratio
AVGO
24.35
FORTY
0.73
EV/EBITDA
AVGO
46.0
FORTY
6.83

Profitability

Gross Margin
AVGO
76.73%
FORTY
19.76%
Operating Margin
AVGO
44.94%
FORTY
5.87%
Profit Margin
AVGO
36.57%
FORTY
23.09%
ROE
AVGO
33.37%
FORTY
6.88%
ROA
AVGO
10.66%
FORTY
3.71%

Growth

Revenue Growth
AVGO
29.5%
FORTY
2.4%
Earnings Growth
AVGO
31.6%
FORTY
2645.3%

Financial Health

Debt/Equity
AVGO
0.83
FORTY
0.33
Current Ratio
AVGO
1.9
FORTY
1.63
Quick Ratio
AVGO
1.67
FORTY
1.54

Dividends

Dividend Yield
AVGO
0.74%
FORTY
1.98%
Payout Ratio
AVGO
47.17%
FORTY
107.08%

AI Verdict

AVGO NEUTRAL

Broadcom exhibits a dichotomy between elite operational performance and poor deterministic value metrics. While the Piotroski F-Score of 4/9 indicates stable health, the stock trades at a massive premium to its Graham Number ($44.08) and Intrinsic Value ($151.04). This valuation gap is partially justified by a very attractive PEG ratio (0.68) and strong forward P/E (19.65), suggesting high growth expectations. However, aggressive insider selling by the CEO and CFO, combined with a bearish technical trend, offsets the strong analyst 'strong_buy' consensus.

Strengths
Exceptional profitability with 76.73% gross margins and 44.94% operating margins
Strong growth trajectory with ~30% YoY increases in both revenue and earnings
Impressive earnings track record with consistent beats over 25 quarters
Risks
Severe overvaluation relative to defensive fair value (Graham Number)
Strong bearish insider sentiment with 14 sell transactions and 0 buys
Technical trend is currently 0/100 (Bearish)
FORTY BEARISH

FORTY exhibits significant financial fragility, highlighted by a weak Piotroski F-Score of 2/9, indicating deteriorating fundamental health. The stock is trading at a substantial premium, with a current price of $124.45 nearly double its Graham Number ($67.88) and Intrinsic Value ($67.85). While the company maintains a low Debt/Equity ratio, the unsustainable dividend payout ratio of 107.08% and a bearish technical trend (0/100) suggest a high risk of price correction. Extreme volatility in earnings growth and stagnant revenue growth (2.4% YoY) further undermine the current valuation.

Strengths
Low Debt/Equity ratio (0.33) indicating manageable leverage
Strong net profit margin of 23.09%
Low Price-to-Sales ratio (0.73) relative to sector
Risks
Severe fundamental weakness indicated by Piotroski F-Score of 2/9
Significant overvaluation relative to Graham and Intrinsic value estimates
Unsustainable dividend payout ratio (107.08%) exceeding earnings

Compare Another Pair

AVGO vs FORTY: Head-to-Head Comparison

This page compares Broadcom Inc. (AVGO) and Formula Systems (1985) Ltd. (FORTY) across key fundamental metrics including valuation ratios, profitability margins, growth rates, financial health indicators, and dividend metrics. Each metric highlights the better-performing stock so you can quickly identify relative strengths and weaknesses.

Our AI engine independently analyzes each company's financials, competitive position, and market conditions to produce a verdict (Bullish, Neutral, or Bearish) along with key strengths and risks. Use this comparison alongside your own research to make informed investment decisions.

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