Broadcom

AVGO-Q

He likes their dividend growth, but they grow by acquisition, therefore carry debt. When credit spreads blow out, it'll become tougher for them to do deals--and there are fewer deals for them to do now. Other semis that pay a dividend, though lower, are growing, and are in 5G are Xilinx and NVIDIA.

Down 11% YTD. Don't panic though, despite their challenges. He still likes it. Look at your overall portfolio. If Broadcomm occupies say 4%, then you're okay, but not at 20%. Trades at a reasonable 11x P/E. Semis are cyclical, high-growth, but high-volatility. Now, we're in the down side of the cycle.

Unlike the Facebooks and Googles of the world they have to make something to sell. And they have to make new and better on a continue basis. They are one of the most diverse players in the space. This industry is starting to mature and consolidate. The chip business is very volatile. (Analysts’ price target is $290)

(Past Top Pick May 4, 2018, Up 9%) For the past six months, it's been exciting to invest in this. Nice free cash flow growth, with dividends and increased share buybacks. In July, the shares dropped when they announced the acquisition of old-school tech company, CA Technologies. But they didn't explain why they bought this company until early-September. When the street heard this reason, shares rebounded. He still likes it.

(A Top Pick July 7/17, Down 11%) A few of the big acquisitions did not happen that he had expected. He still owns it and still buys it. You get 3.25% yield. It is cheap.