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Qualcomm Inc QCOM

Morningstar Rating
$193.05 −1.91 (0.98%)
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Company Report

Qualcomm Remains a Smartphone Chip Leader With Diversification Opportunities in PCs and Auto

We expect Qualcomm’s chip business (QCT) and licensing business (QTL) to continue to generate healthy cash flow and reinforce the company’s narrow moat rating, as Qualcomm should remain an industry leader in chipsets and IP for 5G and below. Apple’s decision to build its own baseband chips, or modems, to displace Qualcomm should be a medium- to long-term headwind, but not a death blow, especially as Qualcomm is poised to grow in automotive and Internet of Things semis. In licensing, Qualcomm has been able to withstand a host of government inquiries and customer pushback in recent years, and we think QTL will maintain a hearty stream of high-margin royalty revenue over time.

Price vs Fair Value

QCOM is trading within a range we consider fairly valued.
Price
$194.97
Fair Value
$488.00
Uncertainty
High
1-Star Price
$171.00
5-Star Price
$289.00
Economic Moat
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Capital Allocation
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Bulls Say, Bears Say

Bulls

Qualcomm collects royalty income on the majority of 4G and 5G handsets sold, as it holds many essential patents used in these networks.

Bears

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.

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News

Trading Information

Previous Close Price
$194.96
Day Range
$192.15196.23
52-Week Range
$104.35230.63
Bid/Ask
$192.86 / $193.08
Market Cap
$215.28 Bil
Volume/Avg
1.4 Mil / 9.8 Mil

Key Statistics

Price/Earnings (Normalized)
21.31
Price/Sales
6.04
Dividend Yield (Trailing)
1.67%
Dividend Yield (Forward)
1.74%
Total Yield
2.55%

Company Profile

Qualcomm develops and licenses wireless technology and designs chips for smartphones. The company's key patents revolve around CDMA and OFDMA technologies, which are standards in wireless communications that are the backbone of all 3G, 4G, and 5G networks. Qualcomm's IP is licensed by virtually all wireless device makers. The firm is also the world's largest wireless chip vendor, supplying nearly every premier handset maker with leading-edge processors. Qualcomm also sells RF-front end modules into smartphones, as well as chips into automotive and Internet of Things markets.
Sector
Technology
Industry
Semiconductors
Stock Style Box
Large Core
Total Number of Employees
50,000

Competitors

Valuation

Metric
QCOM
AVGO
INTC
Price/Earnings (Normalized)
21.3136.9826.48
Price/Book Value
8.9110.671.34
Price/Sales
6.0416.992.56
Price/Cash Flow
21.4633.928.19
Price/Earnings
QCOM
AVGO
INTC

Financial Strength

Metric
QCOM
AVGO
INTC
Quick Ratio
1.850.760.91
Current Ratio
2.651.251.57
Interest Coverage
12.694.720.87
Quick Ratio
QCOM
AVGO
INTC

Profitability

Metric
QCOM
AVGO
INTC
Return on Assets (Normalized)
14.08%17.62%2.83%
Return on Equity (Normalized)
32.62%48.13%5.22%
Return on Invested Capital (Normalized)
19.56%23.28%3.23%
Return on Assets
QCOM
AVGO
INTC
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