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Technology Stocks : The New Qualcomm - a S&P500 company -- Ignore unavailable to you. Want to Upgrade?

To: Valueman who wrote (4472)	12/23/1999 1:40:00 AM
From: LBstocks	Respond to of 13582

Alex Cena's comments on Kyocera deal> QCOM: Mobile Phone Operations Sold to Kyocera; Plus for Financials Qualcomm Inc(QCOM)* Rating: 1H Salomon Smith Barney ~ December 22, 1999 12/21/99 QUALCOMM, Inc. (QCOM $485.38,1-H,Tgt $370.00) Alex M. Cena --SUMMARY:--QUALCOMM, Inc.--Telecommunications Equipment * We continue to recommend QCOM with a 1H rating * QCOM wanted to sell its mobile phone oper based on the impact on its: employees; customers; remaining businesses; & finally sales price. In that order. * QCOM just announced the sale of its handset operations to Kyocera * Kyocera will purchase the majority of its ASIC and software needs from QCOM over the next five years * A big plus for QCOM since Kyocera was one of the few Japanese co's that was not using QCOM's ASICs. I.e. Kyocera becomes a new ASIC customer * While estimates are likely to move up and on the margin this move is a big plus for QCOM, we believe some may be disappointed that the partner was not one of the top tier players. 12/21/99 QUALCOMM, Inc. (QCOM $485.38,1-H,Tgt $370.00) Alex M. Cena --EARNINGS PER SHARE-------------------------------------------------------- FYE 1 Qtr 2 Qtr 3 Qtr 4 Qtr Year Actual 09/99 EPS $0.30A $0.41A $0.75A $0.91A $2.47A Previous 09/00 EPS $N/A $N/A $N/A $N/A $4.00E Current 09/00 EPS $N/A $N/A $N/A $N/A $4.00E Previous 09/01 EPS $N/A $N/A $N/A $N/A $5.30E Current 09/01 EPS $N/A $N/A $N/A $N/A $5.30E Previous 09/02 EPS $N/A $N/A $N/A $N/A $N/A Current 09/02 EPS $N/A $N/A $N/A $N/A $N/A Footnotes: 12/21/99 QUALCOMM, Inc. (QCOM $485.38,1-H,Tgt $370.00) Alex M. Cena --FUNDAMENTALS-------------------------------------------------------------- Current Rank........:1H Prior:No Change Price (12/21/99)....:$485.38 P/E Ratio 09/00.....:121.3x Target Price..:$370.00 Prior:No Change P/E Ratio 09/01.....:91.6x Proj.5yr EPS Grth...:44.4% Return on Eqty 99...:48.9% Book Value/Shr(00)..:9.90 LT Debt-to-Capital(a)0.2% Dividend............:$N/A Revenue (00)........:4163.00mil Yield...............:N/A% Shares Outstanding..:159.0mil Convertible.........:No Mkt. Capitalization.:77175.4mil Hedge Clause(s).....: Comments............:(a) Data as of the most recently reported quarter. Comments............: 12/21/99 QUALCOMM, Inc. (QCOM $485.38,1-H,Tgt $370.00)

To: Valueman who wrote (4472)	12/23/1999 3:22:00 AM
From: Maurice Winn	Read Replies (2) \| Respond to of 13582

<#4--can't comment on the Chinese market. I think anyone that does is purely speculating. I will believe that CDMA is being deployed there when I see the cash in the till. Until then, all chatter.> I think it's a lot more than chatter. Irwin Jacobs is prudent and conservative, not given to wild expectations. That's my department. Irwin said that China is on hold [or words to that effect] and they have made no allowance for China in their 2000 plans. Which is not to say that won't change in a big hurry. I've had first hand reports from somebody who was living in Beijing until last week. They said Beijing is full of CDMA, with ads and phones all over. Qualcomm phones! I'm cross-checking, but we do know there have been 'trial' networks in operation all year. As investors, we have to be ahead of the game and correctly predict how many million CDMA handsets will be in China over the next 5 years. I reckon heaps and heaps. Taking a guess, maybe 300m in 5 years, with HDR on tap. When CDMA arrives in WWeb mode, and GSM is being overlaid, it will be with stunning speed. CDMA benefits are not minor benefits - the CDMA capacity and device functionality advantages are huge and increasingly superior to GSM and 3G GSM efforts. Look here: sina.com and realize that people who can understand those silly squiggles are numerous and increasingly well-off [as long as they don't get too serious with their stupid ideas about taking over Taiwan]. They'll be wanting WWeb and lots of it. Actually, they already HAVE got Taiwan. Also chunks of NZ, Australia, and even the odd house on the banks of the valley where Qualcomm stadium is. If Kyocera already has manufacturing in China, I guess they can easily expand that to include CDMA. It seems that I got all my wishes met. I like that! So, Q! investors should bet now that China will become a huge CDMA customer. It's too late when the money's in the till. Mqurice PS: Fun to see Q! reach over $1000 in 'old money' compared with this time last year still being in the 'natural home in the 40s'.

To: Valueman who wrote (4472)	12/23/1999 7:35:00 AM
From: Jeff Vayda	Respond to of 13582

Vman: From a conceptual point of view: I dont see why people think Nokia should have been the one. Where are the cutting edge phones being shown? Helsinki? Forget about it! The cutting edge phones are coming out of Japan. Forget 1G/2G/2.5G. The future is where we need to focus. Nokia is yesterday's news. Sure they have a massive share of the current market, but have we not all agreed they are behind in the current push forward? They are spending time and money in the present, we need someone to push the envelope into the future. I have seen no indication that they are pressing future applications. The whole continent is happy to sit and work to expand the their old legacy system. Fine let them. The Japanese have already been down that road with PHS. They wont be so smug again. They are hungry for a chance to get back into the forefront. CDMA is that opportunity. The are falling all over each other to put out the best system the world has to offer. CDMA will be showcased in Korea and Japan, right next door to the Chinese... This is a great deal for the Q. Jeff Vayda

To: Valueman who wrote (4472)	12/23/1999 8:33:00 AM
From: Ramsey Su	Read Replies (4) \| Respond to of 13582

VMan, engineer, mq, clark and all, after reading through 8000 posts here and on the other thread, I can only conclude that no one knows what they are talking about. Some may have a more educated opinion, others are pure hotaire. The deal with Kyocera is complicated enough just on what was reported yesterday. None of us what NOK, MOT or the "more than a handful" offers, per Dr. J, were about? In the old days, we second guessed management decisions and used to laugh at the way Dr. J and Harvey White mumble through press conferences and TV appearances. Today, QC management had chalked up a series of pretty sound decisions, including the sale of the handset division. I have to go with management and trust them on this decision to sell to Kyocera. They had plenty of time and plenty of offers to choose from. There is no reason for me not to believe this is the best overall deal available. As an example, the staff arrangement most innovative. My guess is that it is the stone that killed two birds. The affected employees should not be as unhappy as those in the ERICY deal. At the same time, QC seems to have maintained control of very valuable employees indefinitely. I really don't know but I suspect that Nok, MOT, ERICY types would not go for this type of arrangement. As for ASICs, Nokia is not going to abandon their own chipsets for QC's. So they will never be a good partner regardless of what type of ASICs deal they could have made here. In the telecomm arena, Nokia is going to be a competitor in the next few years. Same holds true for MOT to a lessor extent. I remember Chris qdog saying that these forums sometimes cloud his judgement. I have to say in this case, he is right. The more I think about it, the consensus choice of Nokia and MOT made very little sense to me but I kind of went along with that expectation. Now that the news is out, I don't see any arguements that would convince me Nokia would be a better buyer. Better stop here before I sound like mq. Just a final word of thanks to all who help this thread stay somewhat focused on QC. Ramsey

To: Valueman who wrote (4472)	12/23/1999 9:39:00 AM
From: slacker711	Read Replies (1) \| Respond to of 13582

What does Kyocera bring QCOM? Well, they paid up the cash(not much I'm sure), they signed the contract to use Q ASICs for 5 years, and they agreed to this goofy set up with the R&D division(do you really think cost plus will ADD to margins???). Actually I'm not really sure that we could have gotten much more out of Kyocera.... 1) They agreed to pay the current IS-95 royalty rates. I had always assumed that the rate would be reduced for a buyer of the handset division. 2) The agreement on ASIC's is almost painfully absurd. There is NO WAY that Nokia or Mot would have agreed to this....My interpretation is that 70% of ALL CDMA phones will have to have Q's chips. This seems to include IS-95, CDMA2000, W-CDMA, and CDMA/GSM or CDMA/PHS phones. If Molloy is right that Nokia would have taken this and all Qualcomm had to do is reduce royalties I probably would have gone this route (obviously depending on the size of the reduction in royalties). What I cant figure out is why they kept a subsidiary to do design....was this a Qualcomm demand or did Kyocera want it this way. I dont know who this benefits....except the employees of the division. Maybe this was the driver.....or perhaps Clark's concerns about staying close to handset design. Slacker