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Technology Stocks : Qualcomm Incorporated (QCOM) -- Ignore unavailable to you. Want to Upgrade?

To: Maurice Winn who wrote (10855)	5/25/1998 8:33:00 AM
From: tero kuittinen	Read Replies (1) \| Respond to of 152472

Maurice, As ever, I'm impressed by your loyalty to this company. But exactly how much do the stock price gains of early nineties console people who parked their money in QCOM during the last two years. The period was a disaster no matter how you slice it and I do not think that the argument of "yeah, but 92-98 period is still great" has much merit. The point here is that this stock stopped performing back in -96. Coincidentally, this was when the transition into a manufacturing company took place and Qualcomm had to actually start to deliver on the promises that had buoyed the stock between 92-96. The upshot: Qualcomm's E/P ratio has drifted from 100 to 30, while Nokia's has risen from 17 to 30, roughly during the same time period. This is not "fluctuation". This is a re-evaluation of the future prospects of the companies performed by the market. It's too late. Too late to enter the handest market, because the volumes have swelled and the margins have already come down: only the biggest companies will remain profitable. Too late for a quixotic thrust into Europe, which has already committed to GSM and its follow-up, W-CDMA. Too late for a conquest of China, which has already chosen GSM. Trust me on one thing: Nokia will never truly commit to IS-95. It has too much on stake with GSM and W-CDMA. All the big innovations have been introduced in GSM standard, and they will be incorporated into CDMA phones only after a time-lag. Just like Motorola never truly bet the ranch on CDMA , as evinced by the interminable CDMA product delays. The biggest three phone manufacturers, the only ones with real market power, are still putting their R&D money mostly into GSM. Tero