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Technology Stocks : Qualcomm Incorporated (QCOM)
QCOM 165.07-1.0%Nov 18 3:59 PM EST

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To: Ruffian who wrote (28104)4/22/1999 3:40:00 PM
From: SKIP PAUL  Read Replies (3) of 152472
 
Whats wrong with this analysis?

NPV qcom stock price $451

Underlying assumptions:

1. Number of CDMA devices double each year

This year 36 million
year 2 72 million
Year 3 144 million
Year 4 288 million
Total 544 million (9% penetration of world population)

2. Average Profit per device in year 4 $10= $288 million.

3. @ 100 million shares outstanding EPS $28.80

4. PE of 30 in year 4 QCOM price per share = $864

5. Discounted at 15 % per year NPV = $451

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