After a scorching-hot run, semiconductor stocks cooled off in 2022, impacting many portfolios. SOXX, the iShares Semiconductor ETF, is down more than 30% year-to-date, widely underperforming compared to the S&P 500.

In addition, other popular chip stocks, including NVIDIA (NVDA) and Advanced Micro Devices (AMD), have performed poorly in 2022, as shown in the chart below.

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Image Source: Zacks Investment Research

However, Broadcom (AVGO) has entirely snapped the overall bearish trend, with shares climbing more than 25% after bottoming in October. As we can see, the performance has crushed the S&P 500.

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Image Source: Zacks Investment Research

Broadcom is a premier designer, developer, and global supplier of a broad range of semiconductor devices. The company’s products are used in end products such as enterprise and data center networking, home connectivity, set-top boxes, and broadband access, to name a few.

Let’s take a closer look at how the company currently stacks up.

Quarterly Performance

Broadcom’s earnings track record is mighty impressive; AVGO has exceeded top and bottom line estimates in eleven consecutive quarters.

The company penciled in a 1.8% EPS beat paired with revenue 0.4% above expectations in its latest release, providing shares the fuel they needed. AVGO has a favorable revenue trend, as seen in the chart below.

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Image Source: Zacks Investment Research

Dividends & Cash Flow

For those that seek income, AVGO has that covered. The company’s annual dividend currently yields a rock-solid 3.3%, notably higher than the Zacks Computer and Technology sector average.

Undoubtedly a positive, the company has shown a commitment to increasingly rewarding its shareholders, upping its dividend payout five times over the last five years and carrying a sizable 26% five-year annualized growth rate.

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Image Source: Zacks Investment Research

In addition, the company’s free cash flow strength is hard to ignore; in its latest quarter, Broadcom generated roughly $4.5 billion in free cash flow, good enough for a 4% sequential uptick and an even larger 30% Y/Y uptick.

(Click on image to enlarge)

Image Source: Zacks Investment Research

Growth Outlook

For the cherry on top, Broadcom carries a favorable growth profile, with earnings and revenue forecasted to climb 7.4% and 5% in FY23, respectively.

And in FY24, estimates call for an additional 7% growth in earnings and a 4.9% Y/Y uptick in revenue.

(Click on image to enlarge)

Image Source: Zacks Investment Research

Bottom Line

Semiconductors have sailed through challenging waters in 2022, ending stellar runs.

However, Broadcom (AVGO Quick QuoteAVGO - Free Report) has been an exception to the poor performance, widely outperforming other semiconductor stocks and embarking on a strong run since bottoming in October.

The company has consistently exceeded quarterly estimates, rewards investors handsomely, generates solid cash, and has an inspiring growth trajectory for the foreseeable future.

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