Qualcomm (QCOM) 2012 Review

Qualcomm Inc develops, markets and licenses cutting edge integrated circuits used primarily in wireless applications, provides data and positioning services for transportation applications, develops content management technologies and provides a platform for wireless application development.  QCOM has grown profits at a 17%+ annual rate over the last 10 years; and has raised its dividend per share from an initial $.09 in 2003 to $.93 in 2012.  It has done this while earning a 15%+ return on equity.  The company future appears equally promising as a result of:

(1) it is a major beneficiary of the growth in 3G wireless technology,

(2) it is the established technological leader in the high smart phone market,

(3) the growth of data capable devices accelerates the usage of it Snapdragon S1 to S4 chipsets,

(4) it is collaborating with Microsoft to develop chipsets for Windows 8 notebooks and tablets,

(5) acquisitions.

Negatives:

(1)   the current global economic malaise could impact demand,

(2)   it is in a highly competitive industry,

(3)   it is difficult to monitor any patent violations in foreign countries.

The company is rated A+ by Value Line, has no debt but a huge cash position and its stock yields 1.6%.

        Statistical Summary

                 Stock      Dividend         Payout      # Increases  

                Yield      Growth Rate     Ratio       Since 2002

QCOM       1.6%           13%            29%             9*

Ind Ave      1.2              4**              17              NA 

                Debt/                      EPS Down       Net        Value Line

               Equity         ROE      Since 2002      Margin       Rating

QCOM       0%            17%            2                29%           A+

Ind Ave     12               15             NA               10             NA

*QCOM has paid a dividend for only 9 years

**most companies in QCOM industry do not pay a dividend

     Chart

            Note: QCOM stock made good progress off its November 2008 low, quickly surpassing the downtrend off its August 2008 high (straight red line) and the November 2008 trading high (green line).  Long term the stock is in a trading (boundaries outside the chart).  Intermediate term, it is in an uptrend (purple lines).  Short term it is in a trading range (brown lines).  The wiggly red line is the 50 day moving average.  Both the Dividend Growth and Aggressive Growth Portfolios own a 50% position in QCOM (trading sale was made at $58---not my best trade).  The upper boundary of its Buy Value Range is $13; the lower boundary of its Sell Half Range is $84.

http://finance.yahoo.com/q?s=QCOM

12/12