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

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Qualcomm (QCOM - Free Report) closed at $157.42 in the latest trading session, marking a +1.92% move from the prior day. The stock outpaced the S&P 500's daily gain of 0.23%. Elsewhere, the Dow lost 0.03%, while the tech-heavy Nasdaq added 0.43%.

Coming into today, shares of the chipmaker had gained 4.1% in the past month. In that same time, the Computer and Technology sector gained 4.19%, while the S&P 500 gained 3.86%.

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, the Zacks Consensus Estimate for revenue is projecting net sales of $8.30 billion, up 63.46% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $7.18 per share and revenue of $30.69 billion. These totals would mark changes of +71.36% and +30.41%, respectively, from last year.

Investors might also notice recent changes to analyst estimates for QCOM. These recent revisions tend to reflect the evolving nature of short-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. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 1.84% higher within the past month. QCOM is currently a Zacks Rank #2 (Buy).

Investors should also note QCOM's current valuation metrics, including its Forward P/E ratio of 21.52. This valuation marks a premium compared to its industry's average Forward P/E of 20.35.

Investors should also note that QCOM has a PEG ratio of 1.1 right now. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. Wireless Equipment stocks are, on average, holding a PEG ratio of 2.26 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 124, which puts it in the top 49% 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.


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