AVGO vs. BABA: A Head-to-Head Stock Comparison
Updated onHere’s a clear look at AVGO and BABA, comparing key factors like historical performance, profitability, financial strength, growth, dividend, and valuation.
Company Overview
AVGO’s market capitalization of 1,294.30 billion USD is substantially larger than BABA’s 259.33 billion USD, indicating a significant difference in their market valuations.
AVGO’s beta of 1.12 points to significantly higher volatility compared to BABA (beta: 0.21), suggesting AVGO has greater potential for both gains and losses relative to market movements.
BABA is an American Depositary Receipt (ADR), allowing U.S. investors direct exposure to its non-U.S. operations. AVGO, on the other hand, is a domestic entity.
| Symbol | AVGO | BABA |
|---|---|---|
| Company Name | Broadcom Inc. | Alibaba Group Holding Limited |
| Country | US | CN |
| Sector | Technology | Consumer Cyclical |
| Industry | Semiconductors | Specialty Retail |
| CEO | Hock E. Tan | Yongming Wu |
| Price | 275.18 USD | 108.7 USD |
| Market Cap | 1,294.30 billion USD | 259.33 billion USD |
| Beta | 1.12 | 0.21 |
| Exchange | NASDAQ | NYSE |
| IPO Date | August 6, 2009 | September 19, 2014 |
| ADR | No | Yes |
Historical Performance
This chart compares the performance of AVGO and BABA by tracking the growth of an initial $10,000 investment in each. Use the tabs to select the desired time period.
Data is adjusted for dividends and splits.
Profitability
Return on Equity
AVGO
18.95%
Semiconductors Industry
- Max
- 41.84%
- Q3
- 15.81%
- Median
- 6.31%
- Q1
- -5.54%
- Min
- -30.12%
In the upper quartile for the Semiconductors industry, AVGO’s Return on Equity of 18.95% signals a highly effective use of shareholder capital to drive profitability compared to most of its peers.
BABA
13.33%
Specialty Retail Industry
- Max
- 70.52%
- Q3
- 29.03%
- Median
- 10.90%
- Q1
- -7.86%
- Min
- -57.43%
BABA’s Return on Equity of 13.33% is on par with the norm for the Specialty Retail industry, indicating its profitability relative to shareholder equity is typical for the sector.
Return on Invested Capital
AVGO
10.59%
Semiconductors Industry
- Max
- 30.91%
- Q3
- 11.34%
- Median
- 4.08%
- Q1
- -2.17%
- Min
- -19.59%
AVGO’s Return on Invested Capital of 10.59% is in line with the norm for the Semiconductors industry, reflecting a standard level of efficiency in generating profits from its capital base.
BABA
7.90%
Specialty Retail Industry
- Max
- 29.46%
- Q3
- 13.75%
- Median
- 8.05%
- Q1
- 0.80%
- Min
- -17.95%
BABA’s Return on Invested Capital of 7.90% is in line with the norm for the Specialty Retail industry, reflecting a standard level of efficiency in generating profits from its capital base.
Net Profit Margin
AVGO
22.64%
Semiconductors Industry
- Max
- 51.69%
- Q3
- 19.67%
- Median
- 8.56%
- Q1
- -5.44%
- Min
- -38.60%
A Net Profit Margin of 22.64% places AVGO in the upper quartile for the Semiconductors industry, signifying strong profitability and more effective cost management than most of its peers.
BABA
13.06%
Specialty Retail Industry
- Max
- 19.78%
- Q3
- 8.49%
- Median
- 3.43%
- Q1
- -0.69%
- Min
- -9.88%
A Net Profit Margin of 13.06% places BABA in the upper quartile for the Specialty Retail industry, signifying strong profitability and more effective cost management than most of its peers.
Operating Profit Margin
AVGO
35.94%
Semiconductors Industry
- Max
- 58.03%
- Q3
- 22.12%
- Median
- 8.40%
- Q1
- -3.73%
- Min
- -36.14%
An Operating Profit Margin of 35.94% places AVGO in the upper quartile for the Semiconductors industry. This signals a strong ability to translate revenue into operating profit, outperforming most of its competitors in core business efficiency.
BABA
14.14%
Specialty Retail Industry
- Max
- 24.47%
- Q3
- 11.10%
- Median
- 5.85%
- Q1
- 0.66%
- Min
- -12.62%
An Operating Profit Margin of 14.14% places BABA in the upper quartile for the Specialty Retail industry. This signals a strong ability to translate revenue into operating profit, outperforming most of its competitors in core business efficiency.
Profitability at a Glance
| Symbol | AVGO | BABA |
|---|---|---|
| Return on Equity (TTM) | 18.95% | 13.33% |
| Return on Assets (TTM) | 7.85% | 7.21% |
| Return on Invested Capital (TTM) | 10.59% | 7.90% |
| Net Profit Margin (TTM) | 22.64% | 13.06% |
| Operating Profit Margin (TTM) | 35.94% | 14.14% |
| Gross Profit Margin (TTM) | 66.09% | 39.95% |
Financial Strength
Current Ratio
AVGO
1.08
Semiconductors Industry
- Max
- 9.10
- Q3
- 5.23
- Median
- 3.09
- Q1
- 2.49
- Min
- 1.02
AVGO’s Current Ratio of 1.08 falls into the lower quartile for the Semiconductors industry. This indicates a tighter liquidity situation and a more constrained capacity to handle short-term debt than many of its competitors.
BABA
1.55
Specialty Retail Industry
- Max
- 3.24
- Q3
- 1.99
- Median
- 1.42
- Q1
- 1.02
- Min
- 0.54
BABA’s Current Ratio of 1.55 aligns with the median group of the Specialty Retail industry, indicating that its short-term liquidity is in line with its sector peers.
Debt-to-Equity Ratio
AVGO
0.97
Semiconductors Industry
- Max
- 0.97
- Q3
- 0.46
- Median
- 0.21
- Q1
- 0.05
- Min
- 0.00
AVGO’s leverage is in the upper quartile of the Semiconductors industry, with a Debt-to-Equity Ratio of 0.97. While this approach can boost equity growth, it also exposes the company to greater financial vulnerability.
BABA
0.25
Specialty Retail Industry
- Max
- 2.72
- Q3
- 1.42
- Median
- 0.87
- Q1
- 0.35
- Min
- 0.01
Falling into the lower quartile for the Specialty Retail industry, BABA’s Debt-to-Equity Ratio of 0.25 points to a conservative financing strategy. This results in lower financial risk but potentially limits strategic investments compared to more leveraged competitors.
Interest Coverage Ratio
AVGO
5.66
Semiconductors Industry
- Max
- 36.25
- Q3
- 29.12
- Median
- 7.01
- Q1
- -1.22
- Min
- -18.18
AVGO’s Interest Coverage Ratio of 5.66 is positioned comfortably within the norm for the Semiconductors industry, indicating a standard and healthy capacity to cover its interest payments.
BABA
19.85
Specialty Retail Industry
- Max
- 37.34
- Q3
- 17.19
- Median
- 4.28
- Q1
- 0.11
- Min
- -23.60
BABA’s Interest Coverage Ratio of 19.85 is in the upper quartile for the Specialty Retail industry, signifying a strong and healthy capacity to meet its interest payments from operating profits.
Financial Strength at a Glance
| Symbol | AVGO | BABA |
|---|---|---|
| Current Ratio (TTM) | 1.08 | 1.55 |
| Quick Ratio (TTM) | 0.98 | 1.55 |
| Debt-to-Equity Ratio (TTM) | 0.97 | 0.25 |
| Debt-to-Asset Ratio (TTM) | 0.41 | 0.14 |
| Net Debt-to-EBITDA Ratio (TTM) | 1.92 | 0.55 |
| Interest Coverage Ratio (TTM) | 5.66 | 19.85 |
Growth
The following charts compare key year-over-year (YoY) growth metrics for AVGO and BABA. These metrics are based on the companies’ annual financial reports.
Revenue Growth
Earnings Per Share (EPS) Growth
Free Cash Flow Growth
Dividend
Dividend Yield
AVGO
0.84%
Semiconductors Industry
- Max
- 6.48%
- Q3
- 0.93%
- Median
- 0.00%
- Q1
- 0.00%
- Min
- 0.00%
AVGO’s Dividend Yield of 0.84% is consistent with its peers in the Semiconductors industry, providing a dividend return that is standard for its sector.
BABA
1.87%
Specialty Retail Industry
- Max
- 5.54%
- Q3
- 1.52%
- Median
- 0.00%
- Q1
- 0.00%
- Min
- 0.00%
With a Dividend Yield of 1.87%, BABA offers a more attractive income stream than most of its peers in the Specialty Retail industry, signaling a strong commitment to shareholder returns.
Dividend Payout Ratio
AVGO
81.25%
Semiconductors Industry
- Max
- 204.29%
- Q3
- 31.85%
- Median
- 0.00%
- Q1
- 0.00%
- Min
- 0.00%
AVGO’s Dividend Payout Ratio of 81.25% is in the upper quartile for the Semiconductors industry. This indicates a strong commitment to shareholder returns but also suggests that a smaller portion of earnings is retained for reinvestment compared to many peers.
BABA
22.23%
Specialty Retail Industry
- Max
- 177.64%
- Q3
- 9.49%
- Median
- 0.00%
- Q1
- 0.00%
- Min
- 0.00%
BABA’s Dividend Payout Ratio of 22.23% is in the upper quartile for the Specialty Retail industry. This indicates a strong commitment to shareholder returns but also suggests that a smaller portion of earnings is retained for reinvestment compared to many peers.
Dividend at a Glance
| Symbol | AVGO | BABA |
|---|---|---|
| Dividend Yield (TTM) | 0.84% | 1.87% |
| Dividend Payout Ratio (TTM) | 81.25% | 22.23% |
Valuation
Price-to-Earnings Ratio
AVGO
100.28
Semiconductors Industry
- Max
- 86.15
- Q3
- 47.38
- Median
- 27.87
- Q1
- 18.89
- Min
- 4.73
At 100.28, AVGO’s P/E Ratio is exceptionally high, exceeding the typical maximum for the Semiconductors industry. This suggests the stock may be significantly overvalued compared to its peers and implies high market expectations that could be difficult to meet.
BABA
1.79
Specialty Retail Industry
- Max
- 81.45
- Q3
- 42.51
- Median
- 25.40
- Q1
- 12.72
- Min
- 1.88
BABA’s P/E Ratio of 1.79 is below the typical range for the Specialty Retail industry. This may indicate that the stock is potentially undervalued, or it could reflect market concerns about the company’s future prospects.
Forward P/E to Growth Ratio
AVGO
4.83
Semiconductors Industry
- Max
- 4.73
- Q3
- 2.80
- Median
- 1.11
- Q1
- 0.68
- Min
- 0.01
The Forward PEG Ratio is often not a primary valuation metric in the Semiconductors industry.
BABA
0.17
Specialty Retail Industry
- Max
- 5.90
- Q3
- 2.79
- Median
- 1.76
- Q1
- 0.69
- Min
- 0.00
In the lower quartile for the Specialty Retail industry, BABA’s Forward PEG Ratio of 0.17 is a positive indicator. It suggests that the stock may be attractively valued relative to its expected earnings growth.
Price-to-Sales Ratio
AVGO
22.69
Semiconductors Industry
- Max
- 21.96
- Q3
- 10.21
- Median
- 4.45
- Q1
- 2.32
- Min
- 0.48
With a P/S Ratio of 22.69, AVGO trades at a valuation that eclipses even the highest in the Semiconductors industry. This implies the market has priced in exceptionally optimistic scenarios for future revenue growth, posing considerable valuation risk.
BABA
1.84
Specialty Retail Industry
- Max
- 5.26
- Q3
- 2.60
- Median
- 1.29
- Q1
- 0.41
- Min
- 0.06
BABA’s P/S Ratio of 1.84 aligns with the market consensus for the Specialty Retail industry. This suggests its valuation, based on sales, is seen as standard and is on par with its competitors.
Price-to-Book Ratio
AVGO
18.61
Semiconductors Industry
- Max
- 13.12
- Q3
- 6.49
- Median
- 3.31
- Q1
- 1.74
- Min
- 0.23
At 18.61, AVGO’s P/B Ratio is at an extreme premium to the Semiconductors industry. This signifies that the market’s valuation is heavily reliant on future potential rather than its current net asset value, which can be a high-risk proposition.
BABA
0.23
Specialty Retail Industry
- Max
- 12.73
- Q3
- 6.96
- Median
- 3.28
- Q1
- 1.42
- Min
- 0.24
BABA’s P/B Ratio of 0.23 is below the established floor for the Specialty Retail industry. This may signal that the market is deeply pessimistic or has overlooked the company, potentially offering its asset base at a significant discount.
Valuation at a Glance
| Symbol | AVGO | BABA |
|---|---|---|
| Price-to-Earnings Ratio (P/E, TTM) | 100.28 | 1.79 |
| Forward PEG Ratio (TTM) | 4.83 | 0.17 |
| Price-to-Sales Ratio (P/S, TTM) | 22.69 | 1.84 |
| Price-to-Book Ratio (P/B, TTM) | 18.61 | 0.23 |
| Price-to-Free Cash Flow Ratio (P/FCF, TTM) | 57.03 | 28.06 |
| EV-to-EBITDA (TTM) | 44.94 | 10.31 |
| EV-to-Sales (TTM) | 23.70 | 1.95 |