Qualcomm Moderated Thread - please read rules before posting Message Board

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : Qualcomm Moderated Thread - please read rules before posting

QCOM 164.53

-0.4%

Jan 14 3:59 PM EST

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next

To: qinvestor who wrote (91045)	4/22/2010 7:45:01 PM
From: matherandlowell	16 Recommendations Read Replies (4) of 197214

"So what is QC worth... Well 3G is peaking... 3G is near the top of the S curve now and core margins are under pressure. From a fundamental standpoint, I'd say less than a 10-12 PE given the growth rates in the 3G markets are slowing and there are increasing margin pressures in QC's core businesses and few apparent avenues to grow the core business. $2+ earnings * 10 PE = $20-$25..." Your question is certainly a good one but I can't agree with your answer. If you think that 3G is peaking, you are in good company at the "whine festival" currently occupying much of the Board. 3G is not peaking. 3G is just starting a rapid growth phase, not on the top of the S. Fortunately, opinions like yours lead to widespread panic and price depression, allowing guys like me to buy shares on sale. If Buffet were a QCOM investor, he would certainly like buying last week's stock at an 8% discount. I couldn't resist adding to my position today. Listening to the conference call, it is possible to get caught up in the accounting mumbo jumbo and miss the big picture of QCOM. The entire call seemed to be occupied with different explanations of ASP times unit volume. Forget the details: just focus on the earnings guidance. Management raised earnings guidance. And the market went into the panic characteristic of frightened animals-- sending the stock price down. And it might continue to go down for another month or so. BFD. In a year, no one will be able to remember this CC. We will be focused on new numbers and the new numbers will be pushing the stock price closer to 60 than to 25. Companies with 20% growth rates rarely sell for 10x earnings. When they do, it is a good idea to load up. Load up and wait for the day when the whiners are screaming "what was I thinking about?" Margins going down? Is that supposed to be a big headline as a technology goes mass market? Margins should go down. Unit volumes should go up. It is inevitable. The error here is that 3G has peaked. 3G is just getting warmed up. Rather than whine about how many iphones are sold, we should be grateful that we make a piece of every single one of them. And when the Droids start to take market share? Smile. You get a piece of that action too. That's the beauty of the QCOM business model. No matter who has the device of the hour, QCOM shareholders benefit. This is the greatest business model of all time. So when a management as conservative as Qualcomm's announces that it predicts record EPS, rather than lose control of your bowel function, perhaps you should take a deep breath and see that brighter days are ahead. Whine at your own risk but don't short this stock. j.

Report TOU Violation

Share This Post

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next