OK - A stock value calculation:
Let's assume for this part of the argument that there is no China, and for that matter, no new CDMA markets at all.
We still have QCOM doing the following:
Q2-00 Earned .26/share
Q3-00 Estimates are .28 cents per share
BUT:
They just reported shipping 100 Million MSM's to date. At the end of 2000, they had shipped 81 MM. They announced that they shipped 11 Million in Q2-00. That leaves 8 Million MSM's shipped between March 31st and May 10th (the day of the announcement). That is on track to do 16 MM MSM's in Q3-00, or 45% more than in Q2-00. So, QCT revenues for Q3 should hit $404,821 Million.
It is conservative to assume that worldwide CDMA phone sales for the quarter increases by the same 45% which would yield QTL revenues in Q3 of 217,947. Assume a conservative no growth at QWS, and sales here of $190,000. With no productivity improvement, we get to Q3 Revenues of $812,768 Million, and Pre-Tax profit of $409,803. Apply the 35% tax rate, and Net Earnings are $266,372, or .37 cents per share. VERY CONSERVATIVELY (assuming no quarterly growth) annualized to $1.48/share , and a VERY CONSERVATIVE growth rate of 100% (Q3-99 to Q3-00) emerges. So a 100X multiple on $1.48 in earnings would yield a value of $148/share - and this assumes NO INPUT from China, or any other new market going CDMA, assumes no productivity gains, assumes no quarterly growth, and applies a multiple below it the actual growth rate.
Good Luck to all!
So what are we all so worried about? Stocks a bargain here. |
