Broadcom Inc. (NASDAQ:AVGO)

The data reveals notable trends in the share price, operating profit per share, and their corresponding valuation ratio (P/OP) over the observed period.

Share Price

The share price exhibited a consistent upward trajectory from 2009 through 2024, increasing from $1.67 to $220.79 over the 15-year span. Early growth was gradual with moderate gains through 2012, followed by more pronounced increases beginning around 2013. The most significant accelerations in share price occurred post-2019, culminating in a sharp rise from $63.50 in 2021 to $220.79 by the end of 2024, indicating increasing market valuation and investor confidence in more recent years.

Operating Profit per Share (OPPS)

The operating profit per share demonstrated variability across the years. Initial years showed modest profitability growth, peaking slightly around 2011 at $0.24, followed by a small decline and recovery through 2015, where it reached $0.59. The year 2016 marked a notable dip into negative territory (-$0.10), suggesting operational challenges or one-time impacts. Subsequently, there was a strong rebound and general upward slope from 2017 onward, achieving a peak of $3.46 in 2023 before a slight decline to $2.87 in 2024. This pattern indicates periods of volatility but a general improvement in operational profitability in the latter years.

Price to Operating Profit Ratio (P/OP)

The P/OP ratio fluctuated significantly, reflecting varying market perceptions of operational profitability relative to share price. The ratio began at a high 81.9 in 2009, sharply decreased to a low around 12-13 in the early 2010s, indicating relatively undervalued share prices versus profit. Mid-period values were more volatile, with a gap in 2016 corresponding to negative OPPS, making ratio calculation infeasible. Post-2016, the ratio generally rose again, with particularly high values in years like 2019 (36.85), 2020 (44.04), and 2024 (76.87). The increases suggest that share prices grew disproportionately compared to operating profit per share, possibly due to market expectations of future growth or other speculative factors.

Overall, while operating profit per share showed periods of volatility, the sustained and substantial increase in share price led to increased P/OP ratios in the later years. This dynamic indicates a growing investor willingness to pay a premium over current operating profit levels, underpinning expectations of future expansion or improved performance beyond what is currently reflected in operating profits.