Broadcom stock could rise by 40%

Broadcom's stock could shoot up as much as 40% as the chip-maker grabs part of the 'smartphone' market, a Reuters report said.

The Reuters report quoted Cowen & Co analyst Daniel Berenbaum saying that Broadcom 'is in the right markets with the right products.'

'You have to like that and you have to like a company that has executed so well,' the analyst said.

Berenbaum, who rates the shares 'outperform,' expects 10% revenue growth in 2009 and 15% in 2010 and sees free cash flow reaching €680.7 million (US$1 billion) or more by 2010, leading to investors likely willing to pay 25 times free cash flow per share, putting the stock about 40% higher than current levels, the report said.

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