Tech stocks Broadcom (AVGO), Cadence Design Systems (CDNS) and SAP (SAP) continued to climb after their earnings reports. All three broke out of bases and reached new highs on Friday.

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Broadcom stock broke out of an ascending base with a 1,151.82 buy point, according to MarketSmith pattern recognition. The buy zone goes to 1,209.41. The entry coincides with a bullish three-weeks-tight pattern buy point. Shares popped Friday to an all-time high after Goldman Sachs reinstated coverage on AVGO with a buy rating and a 1,325 price target.

The stock’s relative strength line hit a fresh high, a positive sign for the breakout. Broadcom stock started to rally following the chipmaker and infrastructure software provider’s October-ended quarter beat on earnings and sales Dec. 7.

Cadence, SAP Breakouts Join Broadcom Stock

Cadence Design Systems broke out and topped the 279.32 buy point of a flat base and hit an all-time high on Friday. Volume was above average but not impressive. The buy range goes to 293.29.

The company reported better-than-expected third-quarter earnings and sales on Oct. 23, but gave full-year profit guidance that disappointed investors. Shares quickly recovered and have gained about 25% since the October low.

Its AI platform and data analytics environment are integrated and used in product design, including the Tesla (TSLA) Cybertruck.

SAP broke out of a flat base with a 160.35 entry Friday, rising to levels not seen since September 2020. Shares are in a buy zone stretching to 168.37.

The business management software company’s quarterly earnings growth accelerated to 40% in its third quarter, up from 6% and 17% in the prior two quarters. SAP reported four quarters of declining profit prior to that. Meanwhile, quarterly sales growth improved to 12% from 8% and 9% gains in the previous two quarters.

Follow Kimberley Koenig for more stock market news on X/Twitter @IBD_KKoenig.

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