With the fourth quarter and 2020 winding down, many of the top companies we follow on Wall Street are making some changes to the lists of their high-conviction stock picks for clients. With the market hitting all-time highs recently on all the major indexes, it makes sense to examine the lists as the rest of the year and especially January of 2021 could have additional volatility, as the political and geopolitical cycle could still prove to be very explosive components.
In what can only be described as either the most courageous call or the biggest sign of a market top ever, the analysts at BofA Securities have added Broadcom Inc. (NASDAQ: AVGO) to the firm’s US 1 list of top stocks to Buy after a massive run off the September lows. The company has an extensive semiconductor product portfolio that addresses applications within the wired infrastructure, wireless communications, enterprise storage and industrial end markets.
Applications for Broadcom’s products in its end markets include data center networking, home connectivity, broadband access, telecommunications equipment, smartphones and base stations, data center servers and storage, factory automation, power generation and alternative energy systems and displays.
The analysts at BofA Securities have remained positive on the shares for some time, but in the past they have discussed the company’s large double-digit exposure to iPhones, and it should be noted that Broadcom is slated to report quarterly earnings on Thursday of this week.
Broadcom stock investors receive a very reasonable 3.09% dividend. The BofA Securities analysts have a massive $450 price target on the shares, while the Wall Street consensus target is just $402. Shares closed trading on Monday at $420.89, up over 2% on the day.
BofA Securities removed Invitation Homes Inc. (NYSE: INVH) from the list. It is a leading owner and operator of single-family rental properties in the United States. As of the third quarter, the company’s total portfolio consists of over 79,000 homes across 17 markets. The homes are located in attractive in-fill submarkets with relatively high barriers to entry, near employment centers, desirable schools and transportation hubs.
Despite the removal from the US 1 list, the analysts kept a Buy rating on the shares, with a $37 price target, which compares with a $33.75 consensus target and Monday’s closing price of $29.64 a share.