Broadcom Share Prices Jump 10%

Broadcom Corp. shares jumped nearly 10% Wednesday following the release of a bullish investor rating and the announcement of a new plant in Singapore.

The Irvine maker of semiconductors for high-speed communications saw its shares climb $11.38, or 9.7%, to $128 in Nasdaq trading.

The company was boosted by a report issued Wednesday by BancBoston Robertson Stephens, which initiated coverage of Broadcom with a “buy” rating.

“Broadcom has the dominant-market position in each of its three main business segments: cable, networking and set-top box,” BancBoston’s senior communications analyst Arun Veerappan wrote in his report.

“Given Broadcom’s solid-technology positioning, we believe the company can continue to outgrow the market over the coming years,” Veerappan said.

Veerappan forecast per-share earnings would hit 77 cents this year, or about $30 million, and $1.10, or about $43 million, next year. Broadcom last week posted second-quarter profits of 19 cents a share before charges, or $21.2 million, compared with 5 cents a share, or $7.7 million, in the same year-ago period.

Also Wednesday, Broadcom said it opened a new manufacturing and design facility in Singapore, saying the site might manage up to 60% of its worldwide revenue in the next few years.

On Tuesday, Broadcom said technology developed by communications equipment giant Lucent Technologies and Epigram Inc., which it bought in April, had been selected as the basis for a new high-speed home networking standard.

Broadcom’s aggressive growth strategy and strong lock on the market for high-speed chips to power cable modems and set-top boxes had made it popular with day traders, who often tug the stock several percentage points in a single day.