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

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Qualcomm (QCOM - Free Report) closed at $56.80 in the latest trading session, marking a +0.34% move from the prior day. The stock lagged the S&P 500's daily gain of 0.45%. Elsewhere, the Dow gained 0.51%, while the tech-heavy Nasdaq added 0.42%.

Heading into today, shares of the chipmaker had lost 1.92% over the past month, lagging the Computer and Technology sector's loss of 0.69% and the S&P 500's loss of 1.64% in that time.

Investors will be hoping for strength from QCOM as it approaches its next earnings release, which is expected to be January 30, 2019. In that report, analysts expect QCOM to post earnings of $1.08 per share. This would mark year-over-year growth of 10.2%. Our most recent consensus estimate is calling for quarterly revenue of $4.88 billion, down 19.5% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $3.83 per share and revenue of $20.41 billion, which would represent changes of +3.79% and -10.2%, respectively, from the prior year.

Any recent changes to analyst estimates for QCOM should also be noted by investors. Recent revisions tend to reflect the latest 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.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate remained stagnant. QCOM is currently sporting a Zacks Rank of #3 (Hold).

Digging into valuation, QCOM currently has a Forward P/E ratio of 14.8. For comparison, its industry has an average Forward P/E of 16.97, which means QCOM is trading at a discount to the group.

It is also worth noting that QCOM currently has a PEG ratio of 1.6. 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. QCOM's industry had an average PEG ratio of 1.72 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 42, which puts it in the top 17% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.




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