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Non-Tech : The Critical Investing Workshop -- Ignore unavailable to you. Want to Upgrade?

To: Dealer who wrote (25915)	7/19/2000 8:25:14 AM
From: Dealer	Read Replies (1) \| Respond to of 35685

QCOM--Qualcomm figures to be interesting July 19, 2000 by Rex Crum Twenty-seven cents will not buy you much today. For example, here in San Francisco, you can use that windfall to grab a local paper and have 2 cents left over to decorate your penny loafers. You wouldn't think a quarter and two pennies would mean much to anyone. Then again, by the end of the day today, you will know how much 27 cents, or even less, means to Qualcomm Inc. (QCOM). That's because a survey of financial analysts by First Call Corp. is estimating Qualcomm will earn 27 cents a share when it reports its third-quarter fiscal earnings this afternoon. If for some reason those numbers come up to something less than that, it could end up being a very rough rest of the summer in what has been a very rough year for the San Diego-based wireless communications giant. High-flying times As just about everyone with a mobile phone knows, Qualcomm was promising high times at the new millennium. Things were going so well, and the company's technologies were such sure things that Qualcomm was able to offer a 4-for-1 stock split as a New Year's Eve present for its shareholders. The company just about had to, however. Qualcomm shares closed at $647 on Dec. 30, the day before the split. Qualcomm was like the really popular high school kid who has a pool and can pick and choose whom they want to come over and swim. Everyone wanted in, but no one gets a bargain at nearly $650 a share. So the company split. And then things really got interesting. All in all, Qualcomm shares are off by nearly two-thirds from the $179.31 high they hit on Jan. 3. Just Tuesday, Qualcomm's stock fell 6.7 percent to close at $65.13, and the shares closed as low as $53 on July 11. A strong company Nobody doubts that Qualcomm is a good company. Qualcomm's market capitalization is more than $50 billion and it did nearly $4 billion in sales in its 1999 fiscal year. Somebody is buying its stuff. But probably more so than any other wireless company of late, Qualcomm illustrates how the great unknown and potential of wireless can turn a company's fate from week to week. The company, whose name still adorns millions of cell phones around the world, basically got out of the phone-making game when it announced plans to sell its phone business to Japan's Kyocera Corp. (KYO) and completed the sale of its wireless infrastructure business to Ericsson Telephone Co. (ERICY) What makes Qualcomm what it is now is really four letters: CDMA. The company is credited with developing the CDMA wireless technology that is popular in running mobile phones, especially in the United States and Asia. Qualcomm makes a big chunk of its money licensing CDMA to telecommunications companies. Ericsson, for example, uses CDMA in some of its wireless infrastructure and builds products using the technology