Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : Qualcomm Moderated Thread - please read rules before posting -- Ignore unavailable to you. Want to Upgrade?

To: kelseysuncle who wrote (49161)	12/10/2005 9:06:31 AM
From: Jim Mullens	Read Replies (2) \| Respond to of 196568

ku, Re: QCOM valuation / impact of GAAP, Options expensing, and – 1. “You wrote "I think you you’re overlooking the growth element..." I'm not and you're missing my point.” 2. “Decline is not growth and valuations in the face of declining GAAP has not been looked on kindly by Mr. Market.” I understand you’re playing devils advocate, concerned with the market reaction to QCOM, and looking for an explanation for such. But, in all due respect, IMO it is not the GAAP issue. As Slacker and John G have commented - .....” the analysts are all working with pro-forma numbers anyway.” .....”I really don't think it is necessary to make up the $0.18 in earnings. The QCOM accounting presentations are clear and conservative so you can see the trend in earnings from operations VS non-operating items like charges based on stock options awarded years ago.” ....”.. we wait to see if there really is an acceleration in WCDMA uptake...” 3. “My use of TXN, NOK etc for comparison are at least as valid as your use of GOOG, EBAY etc.” <<<<<< Again, NOK and their supplier TXN are NOT “premiere” growth companies, not even growth companies IMO. They are / were the dominant companies that benefited from GSM and their days are numbered as the mobile wireless world transitions to 3G (CDMA/ WCDMA) and the playing field levels. A vast new market (GSM subs) opens to Qualcomm for the first time as 1.3+ Billion subs convert to 3G, and the Q begins to realize revenue from CDMA/ WCDMA handset sales growing at a 5 year compounded annual growth rate (CAGR) of 32%. The “analyst” community for the most part is in a “wait and see/ prove it to me” mode and has not built this into their models yet. The consensus LT growth rate is ONLY 20% as some are using 10% waiting the average down. Further, with the BRCM/ EC anticompetitive claims and Sarbanes-Oxley, Qualcomm remains fairly subdued in talking up the growth story that lies ahead. As John G and others have expressed, the “market” appears to be “waiting to see if there really is an acceleration in WCDMA uptake”. As regards QCOM, the “market” is in a “show me / prove it” mode. Remaining catalysts- 1. Proof of robustly accelerating WCDMA growth 2. China 3G licenses let 3. Positive settlement of EC/ BRCM claims. ................Growth per Yahoo/ First Call ................last 5 yrs....next year.......3-5 years QCOM......25.4%........18.2%...........20%/ year- IMO understated – several analysts w/ 10% NOK.........n/a..............05.9%..........10%.........- EPS growth from R&D cuts / stock buy back TXN..........11.0%........12.2%...........20%.........- IMO overstated , in wireless any way (ref NOK)