Close, re: QCOM Growth. .......................................................................................
“............Not sure why you consider variations in market conditions as 'anomalies'. The market never behaves in a linear fashion....
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1) Of course, seldom linear.
I responded to your point >>> “....I started with 2022 because it is Qcom's previous high for revenue. It's important to assess when Qcom will surpass this bench mark....
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I merely pointed out in detail that your important F22 benchmark was an anomaly / outlier (~30% higher than the prior year) due to covid/ severe supply chain over buying.
2) .You also commented ....”... Wall Street does not reward high PEs when growth projections (for whatever the reasons, Apple, recession, tariffs, etc) are this low for FY26 and FY27.
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Not necessarily so following this Q&A with Gemini .
Bottom line- the SP 500 removing the Mag 7 has a 5 Year revenue CAGR of 5-7%, and a PE of around 19.
Interestingly, QCOMs 5 year revenue CAGR thru F24 was 9.9,..... significantly higher than the average (non- Mag 7) SP 500 stock (5- 7%)
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I guess the question becomes.......... Should QCOM be treated similar to the SP 493
Qualcomm, an innovation champion with foundational intellectual property that pioneered mobile wireless technology—a significant technological miracle of our time—trades at a notably lower valuation than the S&P 493. While the non-Mag 7 portion of the S&P 500 commands a forward P/E of roughly 18.7x, Qualcomm's forward P/E stands at just 12.57x.This suggests the market is currently not assigning a premium to QCOM for its innovation and leadership, leading to a valuation that is a considerable discount compared to the broader market.
Per Gemini-
Based on the closing price from Friday, August 8, 2025, analyst forecasts, and the PEG ratio of the S&P 500 without the "Magnificent Seven" stocks, here is an estimated share price for Qualcomm (QCOM).
Data for Calculation
- S&P 500 without the Mag 7
- Forward PE Ratio: 18.7x
- Long-Term Growth Rate: ~6% (an estimated proxy for the non-Mag 7 portion of the index)
- This gives a PEG ratio of 18.7 / 6 = 3.12
- Qualcomm (QCOM)
- TTM Non-GAAP EPS: $11.72
- Long-Term Growth Rate: 7.1% (analyst consensus)
Estimated Share Price
To estimate Qualcomm's share price based on the S&P 493's PEG ratio, we first calculate the implied P/E ratio for Qualcomm.
Estimated QCOM P/E=S&P 493 PEG Ratio×QCOM Growth Rate
Estimated QCOM P/E=3.12×7.1=22.15x
Using this implied P/E and Qualcomm's latest TTM Non-GAAP EPS, we can estimate the share price:
Estimated Share Price=Estimated QCOM P/E×QCOM TTM Non-GAAP EPS
Estimated Share Price=22.15×$11.72=$259.60........................................... $259
This valuation assumes that Qualcomm's price-to-earnings ratio should be a direct reflection of its growth rate, aligning with the broader market's valuation. |
