We maintain our $140 fair value estimate and narrow moat rating for Qualcomm and continue to view shares as modestly undervalued. The firm’s durable competitive advantage, in our view, comes from patents, intellectual property, and decades of R&D expertise in wireless technologies.
Qualcomm collects royalty income on the majority of 4G and 5G handsets sold, as it holds many essential patents used in these networks.
Qualcomm’s chip business faces a host of challenges, from potential share loss at Samsung and Apple, to some of its customers developing mobile processor IP and design expertise in-house.
|
Metric
|
QCOM
|
AVGO
|
INTC
|
|---|---|---|---|
Price/Earnings (Normalized) | 15.18 | 22.23 | 74.50 |
Price/Book Value | 6.66 | 17.32 | 1.85 |
Price/Sales | 4.06 | 10.92 | 3.52 |
Price/Cash Flow | 13.77 | 20.51 | 14.43 |
|
Metric
|
QCOM
|
AVGO
|
INTC
|
|---|---|---|---|
Quick Ratio | 1.51 | 2.04 | 0.97 |
Current Ratio | 2.33 | 2.50 | 1.53 |
Interest Coverage | 11.27 | 10.03 | −4.36 |
|
Metric
|
QCOM
|
AVGO
|
INTC
|
|---|---|---|---|
Return on Assets (Normalized) | 19.17% | 25.10% | 1.08% |
Return on Equity (Normalized) | 48.02% | 81.60% | 1.97% |
Return on Invested Capital (Normalized) | 27.71% | 31.74% | 1.07% |
|
Ticker
|
Name
|
Morningstar Rating for Stocks
|
Economic Moat
|
Market Cap
|
|---|---|---|---|---|
NVDA
| NVIDIA Corp | Mvw | $1.2 Tril | |
AVGO
| Broadcom Inc | Hwp | $482.8 Bil | |
TSM
| Taiwan Semiconductor Manufacturing Co Ltd ADR | Zzf | $481.4 Bil | |
AMD
| Advanced Micro Devices Inc | Xgrzhs | $195.7 Bil | |
INTC
| Intel Corp | Mypbm | $188.5 Bil | |
TXN
| Texas Instruments Inc | Gmvp | $138.7 Bil | |
ADI
| Analog Devices Inc | Tmgrr | $91.0 Bil | |
MU
| Micron Technology Inc | Wvwh | $84.0 Bil | |
ARM
| ARM Holdings PLC ADR | Wtfjd | $63.1 Bil |
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