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

Qualcomm (QCOM) closed the most recent trading day at $93.17, moving +1.02% from the previous trading session. This change outpaced the S&P 500's 0.84% gain on the day. Elsewhere, the Dow gained 0.03%, while the tech-heavy Nasdaq added 2.51%.

Heading into today, shares of the chipmaker had gained 2.57% over the past month, lagging the Computer and Technology sector's gain of 5.23% and the S&P 500's gain of 3.73% in that time.

Wall Street will be looking for positivity from QCOM as it approaches its next earnings report date. This is expected to be July 29, 2020. In that report, analysts expect QCOM to post earnings of $0.71 per share. This would mark a year-over-year decline of 11.25%. Our most recent consensus estimate is calling for quarterly revenue of $4.79 billion, down 50.26% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $3.65 per share and revenue of $20.81 billion, which would represent changes of +3.11% and -14.28%, respectively, from the prior year.

Investors might also notice recent changes to analyst estimates for QCOM. 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, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. The Zacks Consensus EPS estimate remained stagnant within the past month. QCOM is currently sporting a Zacks Rank of #3 (Hold).

Digging into valuation, QCOM currently has a Forward P/E ratio of 25.25. This valuation marks a premium compared to its industry's average Forward P/E of 22.62.

Investors should also note that QCOM has a PEG ratio of 1.44 right now. 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. QCOM's industry had an average PEG ratio of 2.01 as of yesterday's close.

The Wireless Equipment industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 89, which puts it in the top 36% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. 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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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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