I disagree on Cabi -- he is seeing the light.
While it is lots of fun to bash Cabi, there is a definite change in his tone regarding Qualcomm. If you believe that the basis for his animosity towards Q is because of a CSFB banking relationship with ERICY, this is significant.
I have read his entire report, rather than just the comments and here are some differences I see:
--Obviously, increasing estimates. Last I checked he was cutting.
--"Encouraging" changes in infrastructure rather then "inadequate".
--Acknowledgement of strength of ASIC position where it was previously ignored.
--Suddenly cdmaOne handset market is "relatively empty" as opposed to the coming flood of SE Asian models.
--Now alluding to the positive impact 3g settlement has vis a vis royalties where again, previously ignored.
"However, we recognize that the company is clearly at an inflection point-jettisoning its
infrastructure business and/or OEMing handsets while securing
a royalty position in the 3G scheme would, not surprisingly, make
Qualcomm a much more attractive case.
While the next several months should yield a much more
definitive direction in terms of the 3G IPR issues, we
believe that the company's ASICs business should be largely
responsible for upside on the equipment front. In addition
and after talking with the company, we suspect that royalty
revenues could be in the position to show upside to our
current estimates on the strength of ASICs sales and handset
sales, which have taken advantage of Nokia's absence and
Motorola's gradual immersion into the cdmaOne arena."
And also wrt to ASICs:
"The ASICs division is clearly the sweet spot of the company
and should continue to remain a core strength of the company
due its consistent R&D spending and product introduction
schedule. Over the last several months, our research points
to a more entrenched Qualcomm who could likely hang on to
more than 90% of the cdmaOne chip set market. In our report
on DSP Communications (Report, DSP, 01.27.99), we anticipate
that design wins-particularly those from larger, Korean
players-could, at the very least, take considerable time for
new entrants to secure. And while prospects appear to loom
for these providers, we believe that these Korean
manufacturers are second-sourcing chips as a technique to
broker better chip set pricing more than a serious attempt to
move away from Qualcomm."
Someone who has been as negative as he has cannot suddenly and abrupty do a 180 and put on a Strong Buy. It looks like he may be laying the foundation for some kind of change though. I think this bodes well for eventual harmony with ERICY.
IMHO
mmeggs
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