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Qualcomm (QCOM) Gains But Lags Market: What You Should Know

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Qualcomm (QCOM - Free Report) closed the most recent trading day at $56.60, moving +1.62% from the previous trading session. This change lagged the S&P 500's 3.43% gain on the day. Meanwhile, the Dow gained 3.29%, and the Nasdaq, a tech-heavy index, added 4.26%.

Heading into today, shares of the chipmaker had lost 2.47% over the past month, outpacing the Computer and Technology sector's loss of 12.03% and the S&P 500's loss of 12.15% in that time.

Wall Street will be looking for positivity from QCOM as it approaches its next earnings report date. This is expected to be January 30, 2019. On that day, QCOM is projected to report earnings of $1.08 per share, which would represent year-over-year growth of 10.2%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $4.88 billion, down 19.5% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $3.89 per share and revenue of $20.48 billion, which would represent changes of +5.42% and -9.89%, respectively, from the prior year.

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 such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Our research shows that these estimate changes are directly correlated with near-term stock prices. 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.

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. Over the past month, the Zacks Consensus EPS estimate remained stagnant. QCOM is holding a Zacks Rank of #1 (Strong Buy) right now.

Looking at its valuation, QCOM is holding a Forward P/E ratio of 14.31. Its industry sports an average Forward P/E of 16.55, so we one might conclude that QCOM is trading at a discount comparatively.

We can also see that QCOM currently has a PEG ratio of 1.31. 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. The Wireless Equipment industry currently had an average PEG ratio of 1.58 as of yesterday's close.

The Wireless Equipment industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 17, which puts it in the top 7% 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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