Qualcomm Stock Analysis, Valuation (NASDAQ:QCOM)

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$63.99 $0.86 (1.33%) QCOM stock closing price Feb 20, 2018 (Closing)
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Qualcomm
Updated on : Feb 20, 2018
previous close
QCOM 64 (0%)
NASDAQ 7234.3 (0%)
Closing Price On: Feb 20, 2018
stock rating
RATING: ★★★★★★★★★★ (0/5)
Industry :
Wireless Equipment
Sector :
Computer and Technology
5 Quarter Revenue
Revenue Growth
2018-Q1
$billion
%
YOY GROWTH
Compared to the industry
Long Term Growth
5 Year CAGR:
1.8%
Operating Profit
Operating Margin:
8.3%
Sector Average:
5.3%
5 Quarter Net Profit
Net Margins
2018-Q1
%
LTM Margin
Debt/Equity Ratio
Debt:
22.85B
Debt/Equity Ratio:
 0.96
Compared to the industry
Cash Flow
Operating cash flow:
$1.76B
Net Income:
-$5.95B
Dividend Yield
QCOM dividend yield:
3.5%
PROS      CONS
Operating Margins
FCF Margin
PE Valuation
Long Term Growth
Net Margins
High Debt Burden
ROIC
ROE
Rating: ★★★★★★★★★★ (0/5)
Relative Valuation
QCOM PS :
4.2
Industry PS :
2.8
Sector:   Computer and Technology.   *PE adjusted for one time items.
Other Metrics
Return on Invested Capital:
-13.5%
Return on Equity:
-14%
Free Cash Flow Margin:
25.3%
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Qualcomm Stock Analysis

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Take a look at Amigobulls Qualcomm stock analysis video. This is our analyst opinion covering the buy and sell arguments for QCOM stock.

Note: Amigobulls stock rating is our opinion based on the historical performance of the company's fundamentals. It is not indicative of the future performance of the stock.

Qualcomm Inc. Stock Rating 3.1/5

We at Amigobulls use various financial measures including profit margins, revenue growth and dividends for QCOM stock analysis. We compare Qualcomm valuation with its sector peers to gauge relative attractiveness of QCOM stock. Qualcomm stock rating encapsulates our opinion about the company based on the fundamentals.

Should you buy QCOM stock?

  • Qualcomm's average operating margin of 8.3% was exceptional.
  • The Qualcomm stock currently trades at a price to earnings ratio of 17.9. We rate this as a positive, compared to the industry average of 25.2.
  • The company has a good Free Cash Flow (FCF) margin of 25.3%.

Should you sell QCOM stock?

  • Long term revenue growth of 1.8% over the past 5 years has been disappointing.
  • Qualcomm posted an average Net loss of -18.6% in the last twelve months.
  • Qualcomm has a debt/equity ratio of  0.96, which is worse than the average in the Computer and Technology sector.
  • The company has a negative Return on Invested Capital of -13.5%, which is a red flag.
  • Qualcomm has a negative ROE (Return On Equity) of -14%, indicating the company is not profitable.

Comments on this video and Qualcomm stock

Amigobulls Qualcomm stock analysis helps investors in understanding how the company's fundamentals have performed in the last few quarters. Fundamental analysis of a company is the most often used approach to find the intrinsic value of a stock.

While doing a study of the company financials, Qualcomm revenue growth and profit or net income are two main metrics which help in identifying whether QCOM stock is overvalued or undervalued. One can also combine technical analysis and fundamental analysis to get a holistic picture about QCOM stock.