By
Anders Bylund
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More Articles
January 25, 2008
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On Jan. 24, communications chip designer Broadcom (Nasdaq: BRCM ) released earnings for the 2007 fiscal year, a period ended Dec. 31.
- Broadcom's profit margins deteriorated all through 2007 in a tough competitive environment -- only to jump back with a vengeance in the fourth quarter. Management credits successful launches of new Bluetooth, digital TV, and wireless networking products for the comeback.
- The balance sheet made it through this tough year fairly intact and still debt-free.
(Figures in millions, except per-share data)
Income Statement Highlights
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FY 2007
|
FY 2006
|
Change
|
|
Sales
|
$3,776
|
$3,668
|
3%
|
|
Net Profit
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$213
|
$379
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(43.7%)
|
|
EPS
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$0.37
|
$0.64
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(42.2%)
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Diluted Shares
|
577.7
|
588.3
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(1.8%)
|
Get back to basics with the income statement.
Margin Checkup
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FY 2007
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FY 2006
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Change*
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Gross
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51.5%
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51.1%
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0.4
|
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Operating
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2.3%
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6.6%
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(4.3)
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Net
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5.7%
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10.3%
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(4.6)
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*Expressed in percentage points.
Margins are the earnings engine.
Balance Sheet Highlights
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Assets
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FY 2007
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FY 2006
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Change
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|
Cash + Short-Term Investments
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$2,328
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$2,680
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(13.1%)
|
|
Accounts Receivable
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$369
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$383
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(3.6%)
|
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Inventory
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$231
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$203
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14.1%
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Liabilities
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FY 2007
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FY 2006
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Change
|
|
Accounts Payable
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$314
|
$308
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1.8%
|
|
Long-Term Debt
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$0
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$0
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N/A
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The balance sheet reflects the company's health.
Cash Flow Highlights
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FY 2007
|
FY 2006
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Change
|
|
Cash From Operations
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$832
|
$892
|
(6.7%)
|
|
Capital Expenditures
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$160
|
$92
|
72.6%
|
|
Free Cash Flow
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$672
|
$799
|
(15.9%)
|
|
Owner Earnings
|
$130
|
$347
|
(62.6%)
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Free cash flow is a Fool's best friend.
Competitive Context
|
Market Cap
|
Trailing P/E Ratio
|
CAPS Rating
|
|
Intel (Nasdaq: INTC )
|
$121,008
|
17.6
|
****
|
|
Qualcomm (Nasdaq: QCOM )
|
$66,460
|
20.8
|
***
|
|
Texas
Instruments (NYSE: TXN )
|
$40,320
|
16.3
|
****
|
|
Broadcom
|
$12,540
|
80.2
|
***
|
|
Infineon Technologies AG (NYSE: IFX )
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$6,920
|
N/A
|
**
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Using the latest reported numbers from Capital IQ. Keep your partners close and the competition in your vest pocket.
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