jprincess--In evaluating QUALCOMM and its management, you make an error that others (especially myopic investment advisors) often make, which is to judge a company and its management by stock price.
Instead, you might want to make some comparisons with other "quality" stocks. For one thing, QCOM may be the only major tech company with no debt. For another, it has a huge cash position exceeding $10 billion, which we all, undoubtedly, hope won't have to be used on legal fees, and which eventually might lead to stock buybacks or increased dividends. Third, while you were lamenting the sorry price of the stock, you ignored the fact that book value per share (an important measure of shareholder wealth) INCREASED by 8.4 percent to $9.70 per share.
Looking at those numbers, you have a stock selling at only 4 times book value--very low for a company with a good earnings track record and no debt.
Look at the numbers again. If the fundamentals are as solid as I believe, then the fault is NOT in the management but with people who ignore (intentionally or not) the intrinsic value of the stock, and the recent gains in value as measured by book value.
Then look at the patent portfolio (including the two most recent challenged patents, which the jury determined to be valid). This is the heart of the value of the company, and for the most part, these patents aren't even included in book value. If you're just playing by stock price, you're missing a lot of what the company is.
If you still feel that way, and if there are others like you, then one alternative would be to sell out-of-the-money covered calls, thereby generating some income while you wait for all these patent related matters to be resolved.
Just don't blame management for the attempts of outsiders to dump on the company.
Art |
