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Strategies & Market Trends : Gorilla and King Portfolio Candidates -- Ignore unavailable to you. Want to Upgrade?

To: Uncle Frank who wrote (54408)	10/8/2003 1:08:07 PM
From: Mike Buckley	Read Replies (1) \| Respond to of 54805

Frank, But the rub is cash flow, which is repeatedly hammered by investment losses.... I imagine qcom will change it's primary focus from promoting technology to ROI at some point over the 2-7 year period you specified, but it probably won't be until Dr. J retires. I'm really surprised to see you say that. Management has been telling us for quite awhile that QSI investments will decrease and that cash flow should be positively impacted. Indeed, both seem to be happening. I'm not going to take the time to look up QSI investments, but my records indicate that free cash flow increased 43% in FY02. Free cash flow in the first nine months of FY03 has already exceeded 12-month production in FY02 by 29%. During those nine months, every dollar of revenue generated $0.35 of free cash flow. --Mike Buckley

To: Uncle Frank who wrote (54408)	10/9/2003 1:43:54 PM
From: Apollo	Read Replies (4) \| Respond to of 54805

Frank, Thanks for your guarded view of Qcom. I tend to be pretty optimistic about its longterm prospects, in part because it represents such a large part of my taxable portfolio. <G> I agree that Qcom, the stock, has been an underperformer since 2000. Nearly 4 years is a very very long time. I've been disappointed, too, in the lack of Mr. Market's recognition of Qcom's strengths. However, Qcom, the company, has been rolling. In particular, the company has been moving forward quite smartly, with 2.5G rolling out, and with 3G preparations being made for upgrades in China, in the US, and apparently, even in India. India is starting off nicely. With growth in 3G, in wireless telecommunications and in world economies, I think that the next 7-12 years will be quite lovely for Qcom, with no debt, and relatively low overhead. Moreover, I tend to think the world economy will cycle back upwards. New emerging capitalistic countries, like China and now India, will drive world growth. Even Japan seems to have some recent good business news, and may finally be awakening from its economic doldrums. Macroeconomically, I see Irag's oil coming online in a couple years, and I see new oil being pumped out of West Africa. We may see another oil glut, similar to the late 1990s, with its beneficial industrial consequences. So, overall, as long as one has a 2-12 year timeline, I think Qcom will be golden. It wouldn't surprise me if Qcom's stock price didn't hit $200/share again until, say, 2005-2007 or 2008. Yet even that would represent very substantial growth, about a 500-1000% return for many folks over 9 years for those who bought in 1999 and before. I think that is the worst case scenario. If the world economy cycles up over the next 3 years, oil loosens, political turmoil simmers down, and big emerging economies and the USA grow, then I think Mr. Market could start roaring, and Qcom, the stock, will advance more aggressively as future growth is fully counted. Are there any other Qcom investors on this board, and what do you forsee? Apollo