For the first time since 2001, Irvine-based Broadcom Corp. posted a market value of $20 billion this month.
The company’s shares were at about $20.4 billion last week.
The last time Broadcom boasted a market value this high its shares were falling from their heights after the crash of the technology sector.
Broadcom makes communications chips for a variety of things, including servers, set-top boxes, wireless phones and even iPods.
Broadcom still is far from its peak.
In late 2000, the chipmaker was valued at $60 billion, a peak for any Orange County company.
But it’s come a long way, too. In late 2002, the company hit a market value low of $2.7 billion.
A recent surge in Broadcom’s shares have helped the company broaden its lead as the county’s most valuable. Irvine-based drug maker Allergan Inc. is No. 2 at $15 billion in recent market value.
Broadcom’s stock has climbed more than 30% in just the past three months, easily crushing the major indexes.
Broadcom is beating its sector as well. It’s up more than 80% in the past year. The Philadelphia Semiconductor Stock Index is up less than 40%.
Investors like Broadcom’s play in the consumer market. Some think it might have the best shot to capitalize on the coming convergence of home entertainment and the Internet in what’s dubbed the “digital home.”
The latest push for Broadcom came from another tech company: Apple Computer Inc.
Apple reported better-than-expected fourth-quarter sales and analysts expect more gains, driven by iPods, according to a wire report.
The company could see added sales and profits from the surging devices, according to UBS analyst Alex Gauna.
UBS raised its outlook for Broadcom’s sales for the fourth and first quarters. For the fourth quarter, Broadcom could see $800 million in sales, up from an earlier view of $780 million.
Broadcom’s fourth-quarter results are due Jan. 26.
Booyah!
Speaking of chip stocks, Newport Beach-based Conexant Systems Inc. deserves a mention for its recent run-up.
The stock climbed more than 20% the week of Jan. 9, pushing its market value beyond $1.5 billion.
The company, which makes communications chips for set-top boxes, modems and other products, has received some positive attention once again from Jim Cramer’s “Mad Money” on CNBC.
“Holy cow! Is this an explosive situation?” Cramer said on Jan. 9. “Right now, right here, I am raising my target from $2.50 to $3.50. And boy do I wish I owned this sucker!”
Cramer pumped Conexant in the fall. Then he advised in-vestors to step back for a few months until he fell in love with the stock again in early January.
One More …
Another chip company that’s getting some investor love is Newport Beach-based Mindspeed Technologies Inc.
The company, a Conexant spinoff, is up more than 40% in three months and has more than doubled in the six months.
Mindspeed’s market value still is small at $315 million. But these are some nice recent gains,the company did get a price target upgrade from $3 to $3.50 by N.Y.-based Needham & Co. on Jan. 13.
The company has been riding on its chips for voice over Internet protocol, which lets users talk on the phone over the Internet.
In Mindspeed’s last quarterly report, the company narrowed its loss to $4.3 million from $9.5 million in the prior quarter and more than $25 million in losses a year earlier.
Analysts surveyed by Thomson Financial had expected losses of $5.2 million during the quarter.
Mindspeed reported sales of $31 million, 17% higher than a year earlier.
The company next reports results on Jan. 23. Analysts expect yearly sales growth of 26% and for the red ink to be cut by two-thirds.
New Toshiba Manager
Irvine-based Toshiba America Information Systems Inc., part of Japan’s Toshiba Corp., has brought in a new leader for its telecommunication systems division.
Brian Metherell is vice president and general manager of the division, which provides communication systems to small and midsize businesses.
Metherell comes to Toshiba with experience in the telecommunications industry, having held executive positions at Nortel Networks Corp.
Gates’ Coattails
Aliso Viejo-based Quest Software Inc. is getting some help from Microsoft Corp.
Goldman Sachs Group Inc. analyst Sarah Friar upgraded Quest’s shares on Jan. 11 because it is benefiting from product upgrades at Microsoft.
She raised Quest’s stock rating from “inline” to “outperform,” sending the shares up 3%.
Quest makes software that monitors the delivery of data on networks.
The company’s “disproportionate exposure to favorable trends in software such as Microsoft’s upgrade cycles” bode well, Friar wrote.
Quest also is positioned to capitalize on any growth from Oracle Corp. and IBM Corp., the analyst said.
