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Technology Stocks : The New QUALCOMM - Coming Into Buy Range -- Ignore unavailable to you. Want to Upgrade?


To: temco2 who wrote (4633)1/31/2009 10:57:08 PM
From: Maurice Winn5 Recommendations  Read Replies (3) | Respond to of 9129
 
Yes, it's true that QCOM is lined up for the biggest paradigm shift in biological history [though when DNA invented sex for swapping DNA around it was a pretty good move]. But I learned long ago that people can spend all the money in the world to no good effect. QCOM management is perfectly capable of doing the same if they try hard. Heck, they can do it with one arm tied behind their back. <"look at the cell phone use, who doesnt have one?" I always follow up with "how can QCOM be at these levels when I see things like this?" A group 5 of teenagers were eating in the foodcourt and everyone of them had their cell out either texting or talking. >

Yes, it's a stupendously huge opportunity. But various things erode the money QCOM can get out of it. Competition for a start. If competing ASIC makers are capable, the profits will be competed away. Royalties are being eroded with Nokia having swindled QCOM down to near 1% or 2% and Neelie wanting to skoosh QCOM. Legal decisions have taken big bites too, with patents being denied.

Then there are failures. The handset and infrastructure businesses were ditched as uncompetitive. Globalstar, Vesper, Leap, WirelessKnowledge, Wingcast, Graviton, 724 Solutions, NetZero, Cinecom, SnapTrack and others gobbled $billions with nothing to show for it. Then the stash of cash was eroded by backing wrong financial horses instead of shorting them.

Not to mention stock options galore.

Buying back shares seems dodgy too with QCOM failing to buy the bottom even with all their insider knowledge which should mean they can buy better than anyone else. We have to guess at royalties and much else while management knows just what the agreements are and can see all projections.

QCOM is now about management rather than guessing market and technology futures.

Mqurice