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

To: cfoe who wrote (47714)	11/3/1999 5:41:00 PM
From: Ruffian	Read Replies (1) \| Respond to of 152472

Pete Peterson on the Q> Qualcomm Soars on Profit Report, Stock Split Firm Has Been Best Performer on S&P 500 This Year Get Company Quote, Info: QCOM Reuters LOS ANGELES (Nov. 3) - Qualcomm Inc. stock jumped more than $35, or nearly 16 percent, Wednesday after the high-flying wireless telephone technology developer posted rising profits and analysts said its future looked bright. Shares of San Diego, Calif.-based Qualcomm rose 35-11/16 to 260-1/2 in heavy trading on Nasdaq. The stock has soared from a 52-week low of less than 25. Qualcomm Tuesday announced a four-for-one stock split and said fiscal fourth-quarter net income, excluding charges, more than tripled to $170 million, or 91 cents per diluted share, compared with 27 cents a share a year earlier. The results for the quarter ended Sept. 26 topped Wall Street's consensus expectations of 88 cents a share, according to research firm First Call/Thomson Financial. Revenues rose 14 percent to nearly $1.1 billion. Analysts said the surge in the share price Wednesday mainly reflected a clearer picture Qualcomm gave of its business, its money-losing handset manufacturing operations, and of its future plans. ''They gave us a new snapshot of the company and it's much better than everyone thought,'' said Pete Peterson, an analyst with Volpe Brown Whelan. Peterson said the insight into the handset operations -- which Qualcomm plans to sell by the end of the year amid component shortages and pricing pressures -- served to underline the strength of its other business units, which are offsetting those losses. ''You got to see how dramatically beneficial selling the handset business would be,'' Peterson said. ''The stuff they're left with is better than anyone thought.'' Qualcomm said its profit was driven higher by the growing market for its code division multiple access (CDMA) wireless telephone technology, which is being incorporated into next-generation mobile phone networks. The company also trimmed expenses in the fourth quarter. The company said it would focus on licensing its CDMA patents and developing fast wireless data services, which it hopes will challenge fixed-line broadband technologies such as cable modems and digital subscriber lines. ''The royalty and license fee part of the business is going very well. It's high margin and adds a lot to the bottom line,'' said S&P Equity Group analyst Mark Cavallone. ''The future for the company is extremely bright.'' The results led several analysts to raise their estimates for the company. Deutsche Banc Alex. Brown Wednesday raised its 12-month price target for Qualcomm's stock to $250 from $225 a share, and the brokerage reiterated its ''strong buy'' rating. It also raised its 2000 earnings outlook for Qualcomm to $4.04 a share from $3.70, and raised the 2001 estimate to $4.95 a share from $4.50 a share. Peterson fixed a price target of $285 on the stock, saying profits could hit $4.01 a share in fiscal 2000 and climb to $5.27 in 2001. Cavallone maintained a more conservative estimate of $3.85 a share for 2000, but said the sale of the handset unit could easily propel that to over $4 in 2000. REUTERS Reut17:28 11-03-99