Broadcom (BRCM, Financial) can be one of the safest growth stocks to own in 2015. The company is venturing into several markets and is also offering a decent dividend yield. The company has come a long way and has grown its business in a very attractive way and looking at the company’s prospects, I would recommend that investors buy Broadcom’s stock.
In the past Broadcom, like many other tech organizations, concentrated basically on revenue development and conveying worth to shareholders through that quick development. Today, however, Broadcom recognizes that it is presently a "full grown" organization and that as revenue development eases off, it needs to concentrate all the more on benefits.
The organization redid its operating model from a half 52% gross margin business at more or less 20%-22% operating margin, to a business that sees around 54-57% in gross overall revenue and operating margin of 23%-28%. This implies that the organization will transform a greater amount of its revenues into benefits, which the organization can then return through dividends and/or buybacks.
To further increase its gross margin and profits, Broadcom ventured into the Internet of Things market, or IoT. In August, Broadcom made a sprinkle in the IoT business with its $20 WICED programming developer pack, or SDK, and gadget. WICED Sense accompanies Broadcom's BCM20737 chip and an assembly of sensors, including an electric compass, altimeter and barometer, humidity and temperature sensors, and accelerometer.
The purpose of WICED isn't to instantly open another line of revenue for Broadcom, however rather to sway developers to make IoT applications with the organization's stage and chip, without them needing to pay for lavish gadget models. The WICED framework on-chip, or Soc, backings Apple's iBeacon technology, the A4wp remote charging standard, and even has its own on-chip encryption and unscrambling security.
During the end of 2014, Broadcom further strengthened its position in the IoT market. Broadcom extended the capacities of WICED by including close field correspondence, or NFC, abilities to the SDK. The organization claims it’s the first to incorporate Wi-FI, Bluetooth Smart and NFC into a solitary SDK.
Likewise, Broadcom launched another BCM43907 Soc that the organization says is the business' first double band Wi-Fi sound chip for inserted gadgets. Broadcom says the chip permits remote HD sound streaming to numerous speakers without slack time or reverberation.
Conclusion
Broadcom has grown a lot as a company and is heading in the right direction. Last year, the company decided to divest its mobile business and that has benefited the company. Moreover, the company’s foray into the IoT will reap rewards for long-term investors. Also, unlike many of its peers, Broadcom offers a decent dividend yield and is another plus point for investors. Hence, I think Broadcom is a great stock to hold for investors in 2015.
