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

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Qualcomm (QCOM - Free Report) closed the most recent trading day at $67.59, moving +0.85% from the previous trading session. The stock outpaced the S&P 500's daily gain of 0.61%. At the same time, the Dow added 0.71%, and the tech-heavy Nasdaq gained 0.53%.

Prior to today's trading, shares of the chipmaker had lost 20.72% over the past month. This has lagged the Computer and Technology sector's loss of 8.25% and the S&P 500's loss of 3.77% in that time.

Wall Street will be looking for positivity from QCOM as it approaches its next earnings report date. On that day, QCOM is projected to report earnings of $0.77 per share, which would represent a year-over-year decline of 23.76%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $5.11 billion, down 8.74% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $3.85 per share and revenue of $20.64 billion. These totals would mark changes of +4.34% and -9.2%, respectively, from last year.

Any recent changes to analyst estimates for QCOM should also be noted by investors. These revisions typically reflect the latest short-term business trends, which can change frequently. 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. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, 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. The Zacks Consensus EPS estimate has moved 0.17% lower within the past month. QCOM is currently a Zacks Rank #3 (Hold).

Investors should also note QCOM's current valuation metrics, including its Forward P/E ratio of 17.42. Its industry sports an average Forward P/E of 24.01, so we one might conclude that QCOM is trading at a discount comparatively.

Meanwhile, QCOM's PEG ratio is currently 1.27. 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 3.03 based on yesterday's closing prices.

The Wireless Equipment industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 13, putting it in the top 6% 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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