Comprehensive Stock Comparison
Compare KLA Corporation (KLAC) vs Broadcom Inc. (AVGO) Stock
Analyze side-by-side fundamentals, valuation, growth, and profitability to decide which stock is the better buy.
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Quick Verdict
| Category | Winner | Why |
|---|---|---|
| Growth | KLAC | 23.9% revenue growth vs AVGO's 23.9% |
| Value | KLAC | PEG 1.32 vs 2.23 |
| Quality / Margins | AVGO | 36.2% net margin vs KLAC's 35.8% |
| Stability / Safety | AVGO | Beta 1.75 vs KLAC's 1.76, lower leverage |
| Dividends | AVGO | 0.7% yield, 15-year raise streak, vs KLAC's 0.4% |
| Momentum (1Y) | KLAC | +116.1% vs AVGO's +61.4% |
| Efficiency (ROA) | KLAC | 27.3% ROA vs AVGO's 13.5%, ROIC 46.5% vs 14.9% |
Who Each Stock Is For
Income & stability
Growth exposure
Long-term compounding (10Y)
Sleep-well-at-night portfolio
Valuation efficiency (growth/$)
Defensive / Recession hedge
Business Model
What each company does and how it makes money
KLA Corporation is a leading provider of process control and yield management systems for semiconductor manufacturers. It generates revenue primarily from selling inspection, metrology, and process control equipment to chipmakers — with its Semiconductor Process Control segment contributing roughly 85% of total sales. The company's moat comes from its deep expertise in defect detection and measurement, creating mission-critical tools that semiconductor fabs cannot easily replace once integrated into their production lines.
Broadcom is a semiconductor and infrastructure software company that designs and supplies critical components for data centers, networking, and connectivity. It generates revenue primarily from semiconductor sales (~70%) and infrastructure software licensing (~30%), with key segments including wired infrastructure, wireless communications, and enterprise storage. The company's moat lies in its deep engineering expertise, extensive patent portfolio, and entrenched positions in mission-critical infrastructure where customers face high switching costs.
Revenue Breakdown by Segment
How each company's revenue is distributed across its business units
Financial Metrics Comparison
Side-by-side fundamentals across 2 stocks. BestLagging
Financial Scorecard
AVGO leads in 3 of 6 categories (Financial Metrics, Total Returns). KLAC leads in 2 (Valuation Metrics, Profitability & Efficiency). 1 tied.
Financial Metrics (TTM)
AVGO is the larger business by revenue, generating $63.9B annually — 5.0x KLAC's $12.7B. Profitability is closely matched — net margins range from 36.2% (AVGO) to 35.8% (KLAC). On growth, AVGO holds the edge at +22.0% YoY revenue growth, suggesting stronger near-term business momentum.
| Metric | KLACKLA Corporation | AVGOBroadcom Inc. |
|---|---|---|
| RevenueTrailing 12 months | $12.7B | $63.9B |
| EBITDAEarnings before interest/tax | $5.8B | $34.2B |
| Net IncomeAfter-tax profit | $4.6B | $23.1B |
| Free Cash FlowCash after capex | $4.4B | $26.9B |
| Gross MarginGross profit ÷ Revenue | +61.9% | +67.8% |
| Operating MarginEBIT ÷ Revenue | +42.4% | +39.9% |
| Net MarginNet income ÷ Revenue | +35.8% | +36.2% |
| FCF MarginFCF ÷ Revenue | +34.4% | +42.1% |
| Rev. Growth (YoY)Latest quarter vs prior year | +7.2% | +22.0% |
| EPS Growth (YoY)Latest quarter vs prior year | +41.6% | +3.1% |
Valuation Metrics
At 50.2x trailing earnings, KLAC trades at a 25% valuation discount to AVGO's 67.0x P/E. Adjusting for growth (PEG ratio), KLAC offers better value at 1.59x vs AVGO's 4.80x — a lower PEG means you pay less per unit of expected earnings growth.
| Metric | KLACKLA Corporation | AVGOBroadcom Inc. |
|---|---|---|
| Market CapShares × price | $201.3B | $1.52T |
| Enterprise ValueMkt cap + debt − cash | $205.3B | $1.56T |
| Trailing P/EPrice ÷ TTM EPS | 50.20x | 66.99x |
| Forward P/EPrice ÷ next-FY EPS est. | 41.79x | 31.10x |
| PEG RatioP/E ÷ EPS growth rate | 1.59x | 4.80x |
| EV / EBITDAEnterprise value multiple | 36.43x | 44.06x |
| Price / SalesMarket cap ÷ Revenue | 16.56x | 23.71x |
| Price / BookPrice ÷ Book value/share | 43.45x | 19.08x |
| Price / FCFMarket cap ÷ FCF | 53.79x | 56.29x |
Profitability & Efficiency
KLAC delivers a 83.4% return on equity — every $100 of shareholder capital generates $83 in annual profit, vs $28 for AVGO. AVGO carries lower financial leverage with a 0.80x debt-to-equity ratio, signaling a more conservative balance sheet compared to KLAC's 1.30x. On the Piotroski fundamental quality scale (0–9), KLAC scores 9/9 vs AVGO's 4/9, reflecting strong financial health.
| Metric | KLACKLA Corporation | AVGOBroadcom Inc. |
|---|---|---|
| ROE (TTM)Return on equity | +83.4% | +28.4% |
| ROA (TTM)Return on assets | +27.3% | +13.5% |
| ROICReturn on invested capital | +46.5% | +14.9% |
| ROCEReturn on capital employed | +46.1% | +16.9% |
| Piotroski ScoreFundamental quality 0–9 | 9 | 4 |
| Debt / EquityFinancial leverage | 1.30x | 0.80x |
| Net DebtTotal debt minus cash | $4.0B | $49.0B |
| Cash & Equiv.Liquid assets | $2.1B | $16.2B |
| Total DebtShort + long-term debt | $6.1B | $65.1B |
| Interest CoverageEBIT ÷ Interest expense | 19.31x | 8.09x |
Total Returns (with DRIP)
A $10,000 investment in AVGO five years ago would be worth $67,244 today (with dividends reinvested), compared to $47,638 for KLAC. Over the past 12 months, KLAC leads with a +116.1% total return vs AVGO's +61.4%. The 3-year compound annual growth rate (CAGR) favors AVGO at 76.4% vs KLAC's 59.7% — a key indicator of consistent wealth creation.
| Metric | KLACKLA Corporation | AVGOBroadcom Inc. |
|---|---|---|
| YTD ReturnYear-to-date | +19.8% | -8.1% |
| 1-Year ReturnPast 12 months | +116.1% | +61.4% |
| 3-Year ReturnCumulative with dividends | +307.0% | +448.6% |
| 5-Year ReturnCumulative with dividends | +376.4% | +572.4% |
| 10-Year ReturnCumulative with dividends | +2213.5% | +2389.2% |
| CAGR (3Y)Annualised 3-year return | +59.7% | +76.4% |
Risk & Volatility
AVGO is the less volatile stock with a 1.75 beta — it tends to amplify market swings less than KLAC's 1.76 beta. A beta below 1.0 means the stock typically moves less than the S&P 500. KLAC currently trades 90.0% from its 52-week high vs AVGO's 77.1% drawdown — a narrower gap to the peak suggests stronger recent price momentum.
| Metric | KLACKLA Corporation | AVGOBroadcom Inc. |
|---|---|---|
| Beta (5Y)Sensitivity to S&P 500 | 1.76x | 1.75x |
| 52-Week HighHighest price in past year | $1693.35 | $414.61 |
| 52-Week LowLowest price in past year | $551.33 | $138.10 |
| % of 52W HighCurrent price vs 52-week peak | +90.0% | +77.1% |
| RSI (14)Momentum oscillator 0–100 | 57.1 | 44.2 |
| Avg Volume (50D)Average daily shares traded | 952K | 21.0M |
Analyst Outlook
Wall Street rates KLAC as "Buy" and AVGO as "Buy". Consensus price targets imply 38.9% upside for AVGO (target: $444) vs 9.7% for KLAC (target: $1672). For income investors, AVGO offers the higher dividend yield at 0.72% vs KLAC's 0.44%.
| Metric | KLACKLA Corporation | AVGOBroadcom Inc. |
|---|---|---|
| Analyst RatingConsensus buy/hold/sell | Buy | Buy |
| Price TargetConsensus 12-month target | $1672.25 | $443.72 |
| # AnalystsCovering analysts | 43 | 57 |
| Dividend YieldAnnual dividend ÷ price | +0.4% | +0.7% |
| Dividend StreakConsecutive years of raises | 8 | 15 |
| Dividend / ShareAnnual DPS | $6.76 | $2.30 |
| Buyback YieldShare repurchases ÷ mkt cap | +1.1% | +0.4% |
Historical Charts
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Chart 1Total Return — 5 Years (Rebased to 100)
| Stock | Mar 20 | Feb 26 | Change |
|---|---|---|---|
| KLA Corporation (KLAC) | 100 | 888.53 | +788.5% |
| Broadcom Inc. (AVGO) | 100 | 1,161.79 | +1061.8% |
Broadcom Inc. (AVGO) returned +572% over 5 years vs KLA Corporation (KLAC)'s +376%. A $10,000 investment in AVGO 5 years ago would be worth $67,244 today (including dividends reinvested).
Chart 2Revenue Growth — 10 Years
| Stock | 2016 | 2025 | Change |
|---|---|---|---|
| KLA Corporation (KLAC) | $3.0B | $12.2B | +307.3% |
| Broadcom Inc. (AVGO) | $13.2B | $63.9B | +382.5% |
KLA Corporation's revenue grew from $3.0B (2016) to $12.2B (2025) — a 16.9% CAGR. Broadcom Inc.'s revenue grew from $13.2B (2016) to $63.9B (2025) — a 19.1% CAGR.
Chart 3Net Margin Trend — 10 Years
| Stock | 2016 | 2025 | Change |
|---|---|---|---|
| KLA Corporation (KLAC) | 23.6% | 33.4% | +41.6% |
| Broadcom Inc. (AVGO) | -13.1% | 36.2% | +375.6% |
KLA Corporation's net margin went from 24% (2016) to 33% (2025). Broadcom Inc.'s net margin went from -13% (2016) to 36% (2025).
Chart 4P/E Ratio History — 9 Years
| Stock | 2017 | 2025 | Change |
|---|---|---|---|
| KLA Corporation (KLAC) | 17.9 | 40 | +123.5% |
| Broadcom Inc. (AVGO) | 61.2 | 72.6 | +18.6% |
KLA Corporation has traded in a 17x–40x P/E range over 9 years; current trailing P/E is ~50x. Broadcom Inc. has traded in a 9x–189x P/E range over 9 years; current trailing P/E is ~67x.
Chart 5EPS Growth — 10 Years
| Stock | 2016 | 2025 | Change |
|---|---|---|---|
| KLA Corporation (KLAC) | 4.49 | 30.37 | +576.4% |
| Broadcom Inc. (AVGO) | -0.44 | 4.77 | +1184.1% |
KLA Corporation's EPS grew from $4.49 (2016) to $30.37 (2025) — a 24% CAGR. Broadcom Inc.'s EPS grew from $-0.44 (2016) to $4.77 (2025).
Chart 6Free Cash Flow — 5 Years
KLA Corporation generated $4B FCF in 2025 (+92% vs 2021). Broadcom Inc. generated $27B FCF in 2025 (+102% vs 2021).
KLAC vs AVGO: Frequently Asked Questions
9 questions · data-driven answers · updated daily
01Is KLAC or AVGO a better buy right now?
KLA Corporation (KLAC) offers the better valuation at 50.2x trailing P/E (41.8x forward), making it the more compelling value choice. Analysts rate KLA Corporation (KLAC) a "Buy" — based on 43 analyst ratings — the highest consensus in this comparison. The "better buy" depends entirely on your goals: growth investors should weight revenue trajectory, value investors should weight P/E and PEG, and income investors should weight dividend yield and streak.
02Which has the better valuation — KLAC or AVGO?
On trailing P/E, KLA Corporation (KLAC) is the cheapest at 50.2x versus Broadcom Inc. at 67.0x. On forward P/E, Broadcom Inc. is actually cheaper at 31.1x — notably different from the trailing picture, reflecting expected earnings growth. The PEG ratio (P/E divided by earnings growth rate) is the most growth-adjusted single valuation metric: KLA Corporation wins at 1.32x versus Broadcom Inc.'s 2.23x — a reasonable growth-adjusted valuation.
03Which is the better long-term investment — KLAC or AVGO?
Over the past 5 years, Broadcom Inc. (AVGO) delivered a total return of +572.4%, compared to +376.4% for KLA Corporation (KLAC). A $10,000 investment in AVGO five years ago would be worth approximately $67K today (assuming dividends reinvested). Over 10 years, the gap is even starker: AVGO returned +23.9% versus KLAC's +22.1%. Past returns do not guarantee future results, and the stock with the higher historical return may already have its best growth priced in.
04Which is safer — KLAC or AVGO?
By beta (market sensitivity over 5 years), Broadcom Inc. (AVGO) is the lower-risk stock at 1.75β versus KLA Corporation's 1.76β — meaning KLAC is approximately 0% more volatile than AVGO relative to the S&P 500. On balance sheet safety, Broadcom Inc. (AVGO) carries a lower debt/equity ratio of 80% versus 130% for KLA Corporation — giving it more financial flexibility in a downturn.
05Which has better profit margins — KLAC or AVGO?
Broadcom Inc. (AVGO) is the more profitable company, earning 36.2% net margin versus 33.4% for KLA Corporation — meaning it keeps 36.2% of every revenue dollar as bottom-line profit. Operating margin tells a similar story: KLAC leads at 43.1% versus 39.9% for AVGO. At the gross margin level — before operating expenses — AVGO leads at 67.8%, reflecting greater pricing power or product mix advantage. Stronger margins indicate durable pricing power, lower cost of revenue, or higher mix of software/services. They are one of the clearest signs of business quality.
06Is KLAC or AVGO more undervalued right now?
The PEG ratio (forward P/E divided by expected earnings growth rate) is the most precise measure of undervaluation relative to growth potential. By this metric, KLA Corporation (KLAC) is the more undervalued stock at a PEG of 1.32x versus Broadcom Inc.'s 2.23x. A PEG below 1.5 suggests fair-to-attractive pricing relative to expected growth. On forward earnings alone, Broadcom Inc. (AVGO) trades at 31.1x forward P/E versus 41.8x for KLA Corporation — 10.7x cheaper on a one-year earnings basis. Analyst consensus price targets imply the most upside for AVGO: 38.9% to $443.72.
07Which pays a better dividend — KLAC or AVGO?
All stocks in this comparison pay dividends. Broadcom Inc. (AVGO) offers the highest yield at 0.7%, versus 0.4% for KLA Corporation (KLAC).
08Is KLAC or AVGO better for a retirement portfolio?
For long-horizon retirement investors, Broadcom Inc. (AVGO) is the stronger choice — it scores higher on the combination of lower volatility, dividend reliability, and long-term compounding (0.7% yield). KLA Corporation (KLAC) carries a higher beta of 1.76 — meaning larger drawdowns in market downturns, which matters significantly when you cannot wait years for a recovery. Both have compounded well over 10 years (AVGO: +23.9%, KLAC: +22.1%), confirming both are viable long-term holds — but the lower-volatility option typically results in less emotional selling during corrections. Retirement portfolios generally favour predictability over maximum returns. Consult a financial advisor before making allocation decisions.
09What are the main differences between KLAC and AVGO?
Both stocks operate in the Technology sector, making this a peer-level intra-sector comparison — the same macro tailwinds and headwinds will affect both. AVGO pays a dividend while KLAC does not, making them suitable for different income and tax situations. These fundamental differences mean investors should not choose between them on a single metric — the "better stock" depends entirely on which of these characteristics aligns with your investment strategy.
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