QCOM - Embedded Expectations Analysis - 2020 11 05
QUALCOMM Incorporated (QCOM:USA) currently trades above historical averages relative to UAFRS-based (Uniform) earnings, with a 20.8x Uniform P/E. At these levels, markets have bullish expectations for the firm, but management may have concerns about the QTL segment's revenue run rate, new phone launches, and their innovation's potentialSpecifically, management may have concerns about the sustainability of revenue from new phone launches and rising OpEx costs. Additionally, they may lack confidence in the potential of Release 17. In addition, they may be exaggerating the commercial viability of their 5G network, the growth potential of their radio frequency front-end (RFFE) products, and work-from-home tailwinds. Furthermore, management may have concerns about seasonal headwinds, the coronavirus impact on emerging markets, and Qualcomm Technology Licensing (QTL) segment's automotive-related backlog. Finally, they may lack confidence in their ability to improve the Qualcomm Technology Licensing (QTL) segment's revenue run rate
Qualcomm is engaged in the development and commercialization of foundational technologies for the wireless industry. The company's segments include: Qualcomm CDMA Technologies, which is a developer and supplier of integrated circuits and system software based on code division multiple access, orthogonal frequency division multiple access and other technologies; Qualcomm Technology Licensing, which grants licenses or otherwise provides rights to use portions of its intellectual property portfolio, which, among other rights, include certain patent rights essential to and/or useful in the manufacture and sale of certain wireless products; and Qualcomm Strategic Initiatives, which makes investments.
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