Avago Technologies Ltd (AVGO): Apple Inc. (AAPL)’s Next iPhone Is Among the Many Catalysts for This Company

Avago is expecting the momentum in data-center spending to continue, while also expecting an upswing in its core routing business on the back of infrastructure buildouts in China. As a result of these developments, the wired infrastructure business is expected to grow 20% sequentially.

Finally, in the industrial market, Avago saw 18% sequential growth and better order rates from customers. This is a trend seen across various semiconductor companies. According to an IHS report, the industrial semiconductor market is steadily improving, and chipmakers are reporting lean inventories due to robust demand from customers.

The bottom line
Strength in the mobile market and gradual improvements in infrastructure and industry are some good reasons why Avago can continue to improve. A decent dividend yield of 2.30% at a conservative payout ratio of 31%, negligible debt, and a diversified business further strengthen Avago’s case for the long run.

The article Apple’s Next iPhone Is Among the Many Catalysts for This Company originally appeared on Fool.com and is written by Harsh Chauhan.

Harsh Chauhan has no position in any stocks mentioned. The Motley Fool recommends Apple. The Motley Fool owns shares of Apple and China Mobile. 

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