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Friday, December 22, 2006 9:27:27 AM
12-22-2006 08:57:34 AM
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CONTRIBUTOR http://notablecalls.blogspot.com
Several firms are commenting on QUALCOMM (NASDAQ: QCOM) after the co lowered their EPS guidance overnight:
- Morgan Stanley notes the EPS shortfall is being driven by higher legal expenses and bad debt reserves related to the Pantech Group in South Korea. Firm notes Pantech Group (Pantech, Curitel, and SK Teletech) shipped 4.1MM handsets in the 1H C2006, split between the CDMA and GSM/GPRS market.
With firm's revenue estimate already inline with the new guidance but with their chipset unit estimate slightly below, it suggests a mix shift to lower end phones (which will impact royalties in subsequent quarters) and/or lower sales of chipsets for basestations. CDMA+WCDMA handset shipments in the September quarter (royalties are recognized in arrears) are now expected to be 75-76MM units with a blended ASP of $210 versus firm's estimate of 75MM units and a blended ASP of $209 per unit.
Firm expects to update their estimates when they obtain further visibility into the March quarter. However they estimate there is $0.01 risk to adjusted EPS estimate of $0.43. Firm's F2007 EPS estimate of $1.77 also remains unchanged. They expect QCOM will face a modest amount of selling pressure on the news, as many investors remain hopeful for a favorable outcome of the ongoing licensing dispute with Nokia.
- Jeffco notes QCOM remains one of their best pure play picks into the 3G migration trend. As strong proxy for the broader wireless handset market, QCOM the metics for CY07 remains strong despite the on-going Nokia battle, and supports firm's positive stance on QCOM's position. There has been much pessimism about weaker handset demand, this is a positive datapoint for the sector. Firm believes that visibility should start improving in 2007 with potential resolution or settlement of many of the legal issues.
Maintains Buy and $54 PT.
- Goldman Sachs notes demand fundamentals appear positive which bodes well for the long term outlook for the shares. However, legal issues are likely to continue to dominate in the near-term, negatively impacting sentiment and limiting any near-term earnings upside. Nevertheless, the firm continues to believe that Investors with a long time horizon of 12 months or more will be paid to wait out the near-term impact of legal concerns. Fundamental demand remains healthy as demand for 3G continues to improve and 2G markets still have growth left in them, as QUALCOMM's chip segment continues to integrate in additional features and drive down prices with new chip designs. They see 2 potential upside catalysts: 1) the recent 3G chip win at Motorola could drive upside to 2008 estimates. 2) Qualcomm will be a key beneficiary of China's eventual move to 3G.
Firm is lowering their 12 month price target to $55 from $58.20. Maintains Buy.
Notablecalls: JPM is downgrading their rating to Underweight from Neutral saying that not only do these legal costs appear here to stay for some time, they suspect they could increase even further in the coming months. I expect QCOM to trade down following the downgrade as JPM may indeed be right. On the other hand, I see the stock as a bounce candidate, possibly below the $37 level.
Recent QCOM News
- Form 8-K - Current report • Edgar (US Regulatory) • 08/09/2024 08:05:49 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 08/09/2024 08:05:43 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 08/09/2024 08:05:27 PM
- Form 144 - Report of proposed sale of securities • Edgar (US Regulatory) • 08/08/2024 09:01:47 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 08/05/2024 09:03:28 PM
- Form 144 - Report of proposed sale of securities • Edgar (US Regulatory) • 08/02/2024 08:01:38 PM
- Qualcomm Gewinnmitteilung auf der Investor Relations Website des Unternehmens verfügbar • Business Wire • 07/31/2024 10:50:00 PM
- Publication des résultats de Qualcomm disponible sur le site web de la société consacré aux relations avec les investisseurs • Business Wire • 07/31/2024 10:50:00 PM
- Form 10-Q - Quarterly report [Sections 13 or 15(d)] • Edgar (US Regulatory) • 07/31/2024 08:02:08 PM
- Form 8-K - Current report • Edgar (US Regulatory) • 07/31/2024 08:01:12 PM
- Qualcomm Earnings Release Available on Company’s Investor Relations Website • Business Wire • 07/31/2024 08:00:00 PM
- US Index Futures Up Ahead of Fed Decision; Oil Prices Surge Amid Middle East Tensions • IH Market News • 07/31/2024 10:01:30 AM
- AMD Shares Surge 9% on Earnings Beat; Match Group Rises 10%, Pinterest & Lemonade Drop 13%, and More Earnings Updates • IH Market News • 07/31/2024 09:59:10 AM
- Qualcomm gibt Datum der Ergebnismeldung für das dritte Quartal 2024 und der Konferenzschaltung bekannt • Business Wire • 07/19/2024 08:32:00 PM
- Qualcomm annonce qu’elle va publier prochainement ses résultats pour le troisième trimestre de l’exercice 2024 et qu’elle tiendra une conférence téléphonique • Business Wire • 07/19/2024 04:22:00 PM
- Qualcomm Schedules Third Quarter Fiscal 2024 Earnings Release and Conference Call • Business Wire • 07/19/2024 01:00:00 PM
- Qualcomm gibt Quartalsbardividende bekannt • Business Wire • 07/17/2024 06:43:00 PM
- Qualcomm annonce le versement du dividende en espèces trimestriel • Business Wire • 07/17/2024 06:43:00 PM
- Qualcomm Announces Quarterly Cash Dividend • Business Wire • 07/17/2024 01:00:00 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 07/08/2024 09:39:01 PM
- U.S. Index Futures Mixed Following Tech Sell-Off, WTI and Brent Crude Dip Slightly • IH Market News • 06/25/2024 10:37:15 AM
- Trump Media Resells Stocks and Warrants; KB Home Exceeds Q2 Expectations, and More News • IH Market News • 06/20/2024 10:55:11 AM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 06/04/2024 08:07:43 PM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 06/04/2024 08:07:25 PM
- Form 144 - Report of proposed sale of securities • Edgar (US Regulatory) • 06/03/2024 09:27:46 PM
Maybacks Global Entertainment and ZEASN Technology Private Ltd. Sign Global Licensing Agreement • AHRO • Aug 8, 2024 7:00 AM
SANUWAVE Will Host a Conference Call on August 13, 2024 at 8:30 AM (ET) to Present Q2 Financial Results • SNWV • Aug 8, 2024 6:59 AM
Kona Gold Beverage Inc. Signs Letter of Intent with Bemax, Inc. to Sell Kona Gold, LLC • BMXC • Aug 7, 2024 10:00 AM
Btab Ecommerce Group, Inc. Launches Investor Connect AI Chatbot for Enhanced Investor Engagement and Lead Generation • BBTT • Aug 7, 2024 9:00 AM
Hydromer, Inc. Announces Preliminary Unaudited Second Quarter 2024 Financial Results and Provides Business Update • HYDI • Aug 7, 2024 8:52 AM
North Bay Resources Announces Mt. Vernon Gold Mine Startup, Sierra County, California • NBRI • Aug 5, 2024 9:00 AM