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Technology Stocks : Qualcomm Incorporated (QCOM) -- Ignore unavailable to you. Want to Upgrade?

To: The Reaper who wrote (42668)	9/28/1999 1:13:00 AM
From: MileHigh	Read Replies (1) \| Respond to of 152472

Didn't seem to hurt today anyway. MH

To: The Reaper who wrote (42668)	9/28/1999 1:23:00 AM
From: The Reaper	Respond to of 152472

just thought you'd all like to see H&Q report from May ... ** Hambrecht & Quist Hambrecht & Quist Hambrecht & Quist ** Company: QUALCOMM Inc. Price: 105 Recommendation: Market Perform Notes: a, f Date: 5/18/99 Qualcomm Strong in the Short Term, Faces Difficulty in 2H99 The elimination of handset subsidize in the Korean market will impact QCOM's chipset sales but will be offset in the sort-term by accelerating handset demand in the US & Japan. QCOM faces problems in holding market share and ASP against the Motorola and Nokia in 2H99. 1998 A 1999 E 2000 E Q1 EPS $0.25 $0.32A $0.68 Q2 EPS 0.18 (0.30) 0.58 Q3 EPS 0.16 (0.01) 0.56 Q4 EPS 0.27 0.58 0.54 FY EPS 0.86 0.60 2.35 FY REVS (M) $29.4 $31.0 $33.5 CY EPS 0.94 0.95 2.30 CY P/E NM 112 46.1 FY Ends Sep Current Price $105 7/8 52-Week Range $19 - 119 Market Cap(M) $15,364 Shares Out(M) 145 Book Value $14.89 Net Cash/Share $2.83 3-Year EPS Growth 20% CY99 P/E-to-Growth 557% Decline in Korean chipset demand will be offset in the short-term by increased demand in other geographies. Strong CDMA The elimination of handset subsidies by Korean carriers has and will continue to slow handset demand in Korean. Given that Korean phone OEM's export much of their production to other markets, this decline will probably be offset in the short- term by strong growth in CDMA subscriber growth worldwide. Chipset sales should slow in 2H99 as other ASIC manufactures ramp production. In the long term, Qualcomm's chipset sales may slow as the company's largest customer, Samsung, begins manufacturing it's own handset chips and reduces its ASIC purchases from Qualcomm and DSP Communication expands the customer base for it's competing devices. Although QCOM will collect royalties on DSP chip sales, it only collects handset royalties from Samsung and therefore only stands to loose revenue once Samsung ramps production to supply its own needs. QCOM will post solid growth in the June quarter but faces difficulty in 2H99. Strong CDMA subscriber growth in the US, Japan and Latin America will continue to fuel demand for Qualcomm's products in the short-term. However, very strong demand for Motorola's CDMA StarTAC and the introduction of CDMA versions of Nokia's 6100 handset in 2Q, 5100 in 3Q and 8810 in 4Q will cut into QCOM's market share later this year. More importantly, Qualcomm is likely to face much steeper handset price declines than in past years as the more popular models from Motorola and Nokia grab the premium market segments. 1999 Copyright Hambrecht & Quist LLC. All rights reserved. The information contained herein is based on sources believed to be reliable but is neither all-inclusive nor guaranteed by our firm. Opinions reflect our judgment at this time and are subject to change. We do not undertake to advise you of changes in our opinion or information. In the course of our regular business, we may be long or short in the securities mentioned and may make purchases and/or sales of them from time to time in the open market, as a market maker, or otherwise. In addition, we may perform or seek to perform investment banking services for the issuers of these securities. Most of the companies we follow are emerging and mid-size growth companies whose securities typically involve a higher degree of risk and more volatility than the securities of more established companies. For these and other reasons, the investments discussed or recommended in this report may be unsuitable for investors depending on their specific investment objectives and financial position. This report is not a recommendation or a solicitation that any particular investor should purchase or sell any particular security in any amount, or at all. on suitability considerations, please contact your account executive. RESEARCH NOTES: H&Q publishes brief Research Notes covering very recent or developing events or situations regarding companies or industries covered. These reports are made available to interested clients of H&Q on a request basis. They often contain only partial information in very brief, often in outline form; their purpose is to provide rapid information and preliminary evaluations of such events or situations which may very rapidly be changed as a result of subsequent additional information and analysis. Please contact your Note Legend: (a) Hambrecht & Quist LLC maintains a market in these stocks. (b) Hambrecht & Quist LLC has been an underwriting manager, or co-manager, or has privately placed securities of these companies within the last three years. (c) Hambrecht & Quist LLC has an investment position in these companies. (d) A Hambrecht & Quist LLC employee is a director of these firms. (e) The analysts covering these stocks have investment position. (f) Options are available on these issues. (g) Entities associated with Hambrecht & Quist LLC have an aggregate beneficial ownership of more than 5% of the outstanding equity securities of these companies. (h) Hambrecht & Quist acts as a financial advisor to this company. (r) Restricted. No recommendation at this time. May, but does not necessarily, designate company in registration. He only missed on his 3rd quarter estimate by about...oh, about 8000%. Rating it a market performer. I wasn't aware that the market appreciated almost 100% since the middle of May. kirby

To: The Reaper who wrote (42668)	9/28/1999 1:49:00 AM
From: Uncle Frank	Read Replies (2) \| Respond to of 152472

I imagine that H&Q would react to your expose of their inept May report by saying, Inaccurate prior analyses are not an indicator that we will reach incorrect conclusions in this and future reports. Personally, I believe those who don't learn from history are predisposed to relive it. Think of all of those clueless investors who rely on H&Q reports for their due diligence. It staggers the mind to think of the opportunities they have and will continue to miss. uf

To: The Reaper who wrote (42668)	9/28/1999 7:22:00 AM
From: Labrador	Respond to of 152472

>>At $195, the stock is trading at 72 times our new FY2000 estimate of $2.70 which is a large premium to its 16% EPS growth rate. A Pro Forma analysis of operations without the handset business suggests that earnings could growth to about $3.50 next year, although most of this growth would come from one-time gains from the divestiture of the handset operations. Even with this performance however, the stock would be trading at 56 times Pro Forma FY2000 estimates which is still a premium to its year-to-year earnings growth of 50%.<< I feel very comfortable in saying that I believe that H&Q (as consistently in the past) has again missed the mark. There 2000 earnings prediction (without the divestiture) is about $1 below every major firm that follows QCOM. Considering that earnings are projected for this quarter at around 87 cents, with a static model, this provides over $3 a share earnings [$3.48]. Further, there 16% earnings growth certainly does not consider the divestiture of the infrastructure to ERICY. My view is that we'll see $4.50 next year, with $5.25 not out of the realm of possibility. [Curious how H&Q does focus on other Q ventures, such as MSFT, LU or Globalstar.]Further, to mention that 56 times earnings, which includes a nonrecurring projected sale, shows no purpose -- what analysts base a P/E on earnings including nonrecurring gains? I think that it is obvious that H&Q has had an "agenda" for some time, and fails to provide objectivity in their reports. Wish they'd provide some objectivity so we can compare their projections with other firms' analyses to see why H&Q's projections are so far off the beaten path. [By the way, it is interesting to note that in May 1999, with QCOM at around $100-110, H&Q rated QCOM a "market perform." Obviously, missing the mark and a significant run.]