Back to top

Image: Bigstock

Qualcomm (QCOM) Stock Sinks As Market Gains: What You Should Know

Read MoreHide Full Article

In the latest trading session, Qualcomm (QCOM - Free Report) closed at $154.45, marking a -1.06% move from the previous day. This move lagged the S&P 500's daily gain of 0.04%. At the same time, the Dow added 0.19%, and the tech-heavy Nasdaq gained 0.28%.

Heading into today, shares of the chipmaker had gained 6.71% over the past month, outpacing the Computer and Technology sector's gain of 4.2% and the S&P 500's gain of 3.84% in that time.

QCOM will be looking to display strength as it nears its next earnings release. In that report, analysts expect QCOM to post earnings of $2.10 per share. This would mark year-over-year growth of 112.12%. Meanwhile, our latest consensus estimate is calling for revenue of $8.30 billion, up 63.46% from the prior-year quarter.

QCOM's full-year Zacks Consensus Estimates are calling for earnings of $7.18 per share and revenue of $30.69 billion. These results would represent year-over-year changes of +71.36% and +30.41%, respectively.

It is also important to note the recent changes to analyst estimates for QCOM. These revisions help to show the ever-changing nature of near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. The Zacks Consensus EPS estimate has moved 1.84% higher within the past month. QCOM currently has a Zacks Rank of #2 (Buy).

Looking at its valuation, QCOM is holding a Forward P/E ratio of 21.75. This valuation marks a premium compared to its industry's average Forward P/E of 20.28.

We can also see that QCOM currently has a PEG ratio of 1.11. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. Wireless Equipment stocks are, on average, holding a PEG ratio of 2.25 based on yesterday's closing prices.

The Wireless Equipment industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 176, which puts it in the bottom 31% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.


In-Depth Zacks Research for the Tickers Above


Normally $25 each - click below to receive one report FREE:


QUALCOMM Incorporated (QCOM) - free report >>

Published in