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AVGO vs PEGA

AVGO
Broadcom Inc.
NEUTRAL
Price
$350.63
Market Cap
$1.66T
Sector
Technology
AI Confidence
85%
PEGA
Pegasystems Inc.
NEUTRAL
Price
$43.28
Market Cap
$7.35B
Sector
Technology
AI Confidence
85%

Valuation

P/E Ratio
AVGO
68.48
PEGA
20.32
Forward P/E
AVGO
19.65
PEGA
14.24
P/B Ratio
AVGO
20.79
PEGA
9.36
P/S Ratio
AVGO
24.35
PEGA
4.21
EV/EBITDA
AVGO
46.0
PEGA
23.37

Profitability

Gross Margin
AVGO
76.73%
PEGA
75.86%
Operating Margin
AVGO
44.94%
PEGA
24.92%
Profit Margin
AVGO
36.57%
PEGA
22.54%
ROE
AVGO
33.37%
PEGA
57.32%
ROA
AVGO
10.66%
PEGA
10.46%

Growth

Revenue Growth
AVGO
29.5%
PEGA
2.7%
Earnings Growth
AVGO
31.6%
PEGA
104.3%

Financial Health

Debt/Equity
AVGO
0.83
PEGA
0.1
Current Ratio
AVGO
1.9
PEGA
1.33
Quick Ratio
AVGO
1.67
PEGA
1.23

Dividends

Dividend Yield
AVGO
0.74%
PEGA
0.28%
Payout Ratio
AVGO
47.17%
PEGA
6.34%

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)
PEGA NEUTRAL

PEGA demonstrates exceptional financial health with a Piotroski F-Score of 8/9 and a very low Debt/Equity ratio of 0.10. While the stock trades at a significant discount to its growth-based intrinsic value ($62.83) and analyst targets ($59.36), it is severely hindered by stagnant revenue growth of only 2.70% and an alarmingly high PEG ratio of 15.20. The divergence between strong internal efficiency (ROE 57.32%) and poor top-line growth, coupled with bearish insider selling and a 0/100 technical trend, suggests a period of consolidation or transition.

Strengths
Strong financial health (Piotroski F-Score 8/9)
Exceptional Return on Equity (ROE) of 57.32%
Very low leverage with Debt/Equity at 0.10
Risks
Stagnant revenue growth (2.70% YoY) suggests a lack of market expansion
High PEG ratio (15.20) indicates the stock is overvalued relative to its growth rate
Ongoing legal litigation with Appian Corp. poses a material financial risk

Compare Another Pair

AVGO vs PEGA: Head-to-Head Comparison

This page compares Broadcom Inc. (AVGO) and Pegasystems Inc. (PEGA) 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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