Take it easy Mike. You are letting people panic you. Qualcomm is better now than last week. I say stick with it. This is an obvious outcome from the Korean troubles. I'm sticking with my original statements, namely, Qualcomm gets a billion bucks compliments of the Fed printing machine and buys Samsung or whichever cdmaOne company they fancy. Ericsson will probably do the same which will conveniently get them into the cdmaOne market.
If anyone is surprised by some cancellations and general omigod out of Korea, they haven't been reading the papers. But it doesn't mean the sky is falling. New Zealand did exactly the same thing. I mean exactly. In 1987, big time crashings after property speculations, with banking crisis and all that stuff. Unemployment shot up. Quite a recession. Many properties to lease. But you know what? Cellphone sales just carried on increasing all the way. Because they aren't a luxury. They are an economic tool for day to day living. They give users a return on investment in time saved, orders received, communication in general. If anything, cellphone orders will increase as people get back to work instead of thinking they are rich Koreans who can fly around the world to NZ drinking pina colada. Now they have to stay in Korea and get back to work. That means more cellphone sales.
Wheeee!!!!!!
Said Dr. Irwin Jacobs, chairman and CEO of QUALCOMM Incorporated. "We are working actively with our Korean customers to help them weather this difficult economic downturn. CdmaOne technology continues to be rapidly deployed around the world.
That means they are looking at buying! How else can they help them weather this difficult economic downturn? And I bet Ericsson is in like a hungry dog too. Remember Qualcomm went shopping for property in San Diego during the slump and came up with super quantities for cheap. Well, they can do that with Korean cdmaOne companies and get instant access to Korean markets plus pick up some cheap equity in Korean companies.
Meanwhile, Qualcomm owns a handy little chunk of Globalstar, which is going to start flying pretty soon. That will deliver cdmaOne phone service right into "Asia's" backyard.
Several years ago, a Qualcomm guy told me that they expected to sell cdma handsets like 6 packs. Just pick a pack up at the corner store. Sure the Q-phone and Globalstar phones are expensive to start. But the inherent cost is low. There are cheaper models for those who don't want to pay the high margin.
What a laugh that a couple of cancelled orders, which was an obvious outcome of an economic crunch in Korea, caused such commotion again. Everyone bar a few in the Qualcomm stream are panicky and crying doom. Even old die hard Ramsey is folding, largely on the basis of a high P:E Dow and Asian overflow problems.
But did I buy in the latest downcrunch - which I admit surprises me at how low it has gone - I bought in at $51 and it was the first time I have subsequently seen the price go lower than I paid. I therefore underestimated the panic. Too bad. No, I didn't buy Qualcomm. I bought Techniclone [TCLN]. Yep, I'm now an expert on how many erlangs fit into a monoclonal antibody. Take a peek at TCLN! Have you seen such a graph heading for zero?
Anyway, I've just come back from rolling in the ocean at Piha. Nobody can be pessimistic after that.
Maurice. |
