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Technology Stocks : Qualcomm Incorporated (QCOM)
QCOM 171.81+0.5%9:53 AM EST
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To: Wyätt Gwyön who wrote (111862)1/29/2002 10:43:10 PM
From: pyslent  Read Replies (1) of 152472
 
As an investor, I find that it's easier to project what the market will be rather than assume growth rates, which is always dangerous. What will the market look like for QCOM products in 2006? I think i speak for all QCOM enthusiasts when I paraphrase that question to: how many cell phones will be sold per year worldwide at that time?

From the other thread:

Message 16980589

"we're talkin' maybe 4 or 5 hundred million CDMA handsets, with most of the high end and many devices."

That gives QCOM about $5 eps (give or take a few pennies for the 20 million or so PC cards, specialized devices, etc). Assign a reasonable PE of 25, and we get a share price of $125. If they achieve that by 2006, its a 27% annualized return from today's levels.

Most QCOM investors probably see this as a reasonable scenario. Of course, there are potential upsides and downsides.

To Mucho's credit, when QCOM was at $65 just a month ago, the expected return on the above scenario drops to a 15% annualized return. Mucho is right; a good investor is compelled to evaluate the net present value of his holdings so he can recognize when a stock has gotten ahead of itself. I'm a huge fan of QCOM, but if it hits 200 on hype, I want to know that it's time to sell!
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