About 10 minutes I think Note the following article:
Note the third from last paragraph by Cavallone - How is he partially right?? "The upside is limited." - there's brilliant statement - limited to what $1000, $2000, what, what? Sorry for the rant - idiots
Wednesday December 29, 6:54 pm Eastern Time
FOCUS-Qualcomm climbs by $30 billion after comments
(Adds closing, after-hour prices, releads)
LOS ANGELES, Dec 29 (Reuters) - Another day, another $30 billion for Qualcomm Inc. (NasdaqNM:QCOM - news).
The developer of mobile telephone technology saw its value rise by more than 30 percent, or $30 billion, Wednesday after a bullish analyst report said the meteoric stock could hit $1,000 a share next year.
The San Diego-based company's stock soared $156 to $659 a share after the comments by brokerage firm PaineWebber re-stoked the raging investment fire that has made Qualcomm one of the Nasdaq's best-performing stocks of 1999.
The surge continued in the after-hours market, with Qualcomm trading around $690.
The rise followed weeks of double-digit daily gains that have added tens of billions of dollars to Qualcomm's market capitalization, which now stands at nearly $128 billion, more than new economy darling Yahoo! Inc.'s $119 billion.
PaineWebber analyst Walter Piecyk slapped a ``buy' rating and a $1,000 price target on the stock.
The stock has risen some 2,600 percent since the start of the year, when it traded at around $25.
Wednesday's comments were the latest in a run of rosy news that started with its earnings report in early November and that has pumped fuel into Qualcomm's afterburners.
The gains have made Qualcomm one of the best-performing stocks this year on the Nasdaq and in the Standard & Poor's 500 index.
The only other companies that have performed better in 1999 appeared to be Sensar Corp. (NasdaqSC:SCII - news), up more than 40-fold, Puma Technology Inc. (NasdaqNM:PUMA - news), up 2,700 percent, and Digital Lightwave Inc. (NasdaqNM:DIGL - news), up 2,600 percent.
Back in November, when its stock was trading at around $250 a share, Qualcomm set a four-for-one stock split to try to make the stock more attractive to small investors. The split was approved on Dec. 20 and is to take effect on Friday.
Analysts say they like Qualcomm because the San Diego, Calif.-based company holds key patents on new mobile telephone technology called CDMA, or code division multiple access, which is the foundation of the latest wireless networks.
The company has also moved to shed its less profitable businesses, most recently striking a deal to sell its money-losing handset division to Japan's Kyocera Corp. (NYSE:KYO - news)
It is focusing instead on collecting a swelling stream of royalties and licensing fees for its technology and in making and selling CDMA chipsets to mobile phone makers.
It also has spelled out its plans for delivering data and Internet content over wireless connections, an area many analysts and industry observers say will be the next big boom in technology.
In his report, Piecyk said Qualcomm sells over 90 percent of the sophisticated chips used in CDMA phones, and forecast that by 2010, 85 percent of mobile phones sold worldwide will use CDMA, up from 18 percent today. This would create a 45 percent compound annual growth rate for CDMA and up to a $20 billion royalty stream for Qualcomm, he said.
Other analysts, however, have more modest price targets for the stock. Last week, Lehman Brothers raised its target to $520 from $450 and JP Morgan raised its target to $570 from $460.
``With Qualcomm, you don't have to pick the right manufacturer. If Motorola wins, if Lucent wins or Nortel or Nokia or Ericsson, they don't care. Either way, Qualcomm gets a piece of the action. It's a safe bet on wireless,' said Salomon Smith Barney's Alex Cena, who has a six- to 12-month price target of $600 to $650.
Mark Cavallone, an analyst with the S&P Equity Group, said while he was still upbeat on the company, he had lowered his rating on the stock last week to ``accumulate' from ``buy.'
``I thought the valuation was getting high and that the upside was limited. Obviously I'm being proved partially wrong today,' Cavallone said.
While Qualcomm's gravity-defying performance this year would be tough to replicate, analysts said they still see strong potential for the company as demand for wireless phones explodes and wireless data services mature.
``For Qualcomm to be up 18-fold next year is unreasonable to expect, but could you get a 40 percent move in the stock next year? Sure,' Cena said. |
