"Target Acquired, PROTON CANNON!!" —Iron Man.
I just spent about $95k SGD on Broadcom Corp tonight.
Markets are irrationally worried about their latest acquisition, the cost of acquisition of CA Technologies is $18.9bil...
yet the markets have wiped out more than 15% of the market cap of Broadcom tonight, just based on this news.
15% of the market cap prior to today.... works out to be approximately $18bil too.
This means that the markets are expecting the acquisition to be SO BAD, that..... the entire value of CA Technologies will be wiped out to zero post acquisition.
Doesn't make sense to me.
Broadcom earned a profit of $8 per share the last quarter.
TTM EPS is $25, assuming a massive MOS and EPS turns out to be just $18, at my purchase price, the PE is still only 11.4x, the lowest in the past 3 years (or longer, I only checked the past 3 years data)
The company generates a shit ton of FCF every quarter, and is looking to deploy it.
(Oh I understand how that feels. The itchiness of the proton cannon)
TTI sold put options and received USD $1,716.
At the same time, I bought 300 shares of AVGO at a total cost of USD $62,044.
Positions are already in the green to the tune of a profit of USD 700+. (see attached)
Let's see how powerful TTI's proton cannon is.