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Fly News Breaks for November 2, 2017
BRCD, AVGO
Nov 2, 2017 | 14:37 EDT
BofA Merrill Lynch estimates moving its domicile to the U.S. could raise Broadcom's (AVGO) tax rates from 4%-5% to about 12%, but the firm thinks this could be offset by potential Brocade (BRCD) synergies. The firm keeps a Buy rating on Broadcom, arguing that the reasons to own the stock - namely its premium assets, best-in-class management, and dividend potential - remain intact. The firm adds that being in the U.S. could be a precondition to acquiring Brocade and may enable Broadcom to pursue future M&A.