Goldman Sachs analyst Toshiya Hari downgraded Broadcom (AVGO) to Neutral and cut his price target for the shares to $220 from $300. The stock closed yesterday up $5.06 to $208.31.
The analyst sees increased uncertainty surrounding the company's "strategic focus going forward" following its acquisition of CA Technologies (CA). Hari wonders if Broadcom will now become more of a software company longer term and how sustainable its competitive position is in the core semiconductor business. Further, the analyst asks if Broadcom's share loss to Qorvo (QRVO) in the radio frequency space is the beginning of a trend. Management will need to provide greater clarity on their forward strategy and it will take time to gain investors' confidence, Hari tells investors in a research note.
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