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Technology Stocks : Qualcomm-News Only

QCOM 163.32

+2.3%

Nov 21 9:30 AM EST

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To: DaveMG who wrote (118)	6/23/1999 10:31:00 AM
From: DaveMG	Read Replies (2) of 426

6/23/99 Tim Luke of Lehman raises estimates...again! QUALCOMM:Happy Travels With Mgmt, Strong Trends, Ests & Target Raised, Buy] Tim Luke * After spending several days travelling with senior Qualcomm management visiting investors in Europe, we maintain the wireless industry innovator & CDMA pioneer is continuing to experience strong trends across its all 3 of its core businesses of CDMA chipsets, handsets and royalties. * Believe QCOM's chipset unit has seen exceptionally robust trends in 3Q99 with sales now likely to exceed our est of $260 mill Vs $230 mill in 2Q99 & visibility remaining good through 4Q99. Upside in FY00 could come from discussions with key target accounts; Ericsson, Motorola, Kyocera & even Nokia potentially leading to new orders. * QCOM's handset unit continues to make strides in improving operating margins with new ThinPhone seeing strong demand. Official launch of ThinPhone by Sprint PCS over next several weeks could coincide with new order announcements. Delays in launch of dual-mode offerings by rivals eg; Nokia also helping (sales may reach $450 mill in 3Q99 Vs $400 mill in 2Q99) * CDMA royalty revenues should sustain impressive growth as network rollouts gain momentum in Japan, Brazil & China and as sub growth accelerates in Korea & US with key vendors such as Nokia & Motorola releasing new handsets. Royalties to move from $77 mill in 2Q99 to at least $85 mill in 3Q99. * Based on strong revenue & margin trends, our high end earnings estimates move upwards for FY99 from $2.11 to $2.18 & for FY00 from $2.78 to $3.02. Continue to believe these ests are likely to be revised steadily upwards as CDMA gains momentum around the world. Reiterate our Buy rating & raise our price target from $150 to $165 or 40-45x our initial CY01 estimate of $3.90

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