QCOM - General Stock Discussion

This thread is for general discussion about QCOM stock.

Qualcomm has been on a downtrend with the rest of tech stocks, but surprised it is not bleeding as much today. One thing I like about it, options are generally cheaper than nvda or amd.

Last few days have had a mix of news:

Chart shows it currently is at strong resistance. I’ll be keeping an eye out for a bounce. Not sure given CPI tomorrow.

Earnings today after close. Anyone playing it? I have a long qcom call for july 155 that’s kinda getting destroyed right now. Market looks like poop, but the fundamentals on QCOM don’t really make sense for me for it to sell off this hard. I understand they will likely have some impact to their licensing revenue due to russia sanctions and there is risk from China, but to sell off this hard seems kinda nuts to me. They’re trading at like 15x PE and forward PE of 10x. They’ve committed to buying back a ton of shares, and the average price target for QCOM is like over $200. They’ve consistently beaten earnings. It’s going to be interesting to see what will happen today in the earnings and how much the geopolitical situation is going to hurt their earnings.

Massive beat by qcom

EPS: $3.21, adjusted, versus $2.91 expected, up 69% year-over-year

Revenue: $11.16 billion, adjusted, versus $10.60 billion expected, up 41% year-over-year

QCT (chip sales): $9.55 billion versus $8.86 expected per StreetAccount, up 52% year-over-year

QTL (technology licensing): $1.58 billion versus $1.55 expected per StreetAccount, down 2% year-over-year

Licensing is down due to sanctions, but not too bad.

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Qualcomm Inc forecast third-quarter revenue above analyst expectations after beating second quarter revenue and profit estimates on Wednesday, largely due to its move to focus on a growing non-handset business to cushion a likely hit from slowing smartphone demand.

Lockdowns in China, war in Ukraine and rising inflation has taken a toll on consumers, preventing them from spending on electronic gadgets like phones. However, Qualcomm remained cushioned from that so far.

“The market in China is changing a bit. I think we’re kind of less impacted by it because we’re really focused on the premium and high-tier” smartphone market, Chief Executive Officer Cristiano Amon told Reuters.

“These (Qualcomm) results lay the foundation to make a strong case that the smart phone business is still strong after the traditionally big holiday quarter,” said Dan Morgan, senior portfolio manager at Synovus Trust Company, adding that Qualcomm derives 25% of its sales from making modem solutions for Apple.

Still to reduce its dependence on handsets, Qualcomm has been diversifying its revenue streams by catering to other markets including automotive.

For example, Qualcomm’s automotive business pipeline is now at $16 billion, up from $13 billion late last year, mostly thanks to a deal it struck recently with automaker Stellantis, said Amon.

Qualcomm forecast current-quarter revenue between a range of $10.5 billion and $11.3 billion, compared with analysts’ estimates of $9.98 billion, according to IBES data from Refinitiv.

Guidance looking pretty good for QCOM. Hopefully we can break this nasty downtrend.

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