154.52 USD
-1.3 (-0.83%)
155.99 USD
+1.47 (+0.95%)
We assign a fundamental rating of 7 out of 10 to QCOM. QCOM was compared to 113 industry peers in the Semiconductors & Semiconductor Equipment industry. QCOM scores excellent points on both the profitability and health parts. This is a solid base for a good stock. A decent growth rate in combination with a cheap valuation! Better keep an eye on QCOM. Finally QCOM also has an excellent dividend rating. These ratings could make QCOM a good candidate for value and dividend and quality investing.
1. Profitability
1.1 Basic Checks
- QCOM had positive earnings in the past year.
- QCOM had a positive operating cash flow in the past year.
- Each year in the past 5 years QCOM has been profitable.
- QCOM had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
- With an excellent Return On Assets value of 11.05%, QCOM belongs to the best of the industry, outperforming 81.42% of the companies in the same industry.
- QCOM has a Return On Equity of 26.13%. This is amongst the best in the industry. QCOM outperforms 90.27% of its industry peers.
- QCOM has a Return On Invested Capital of 21.40%. This is amongst the best in the industry. QCOM outperforms 93.81% of its industry peers.
- The Average Return On Invested Capital over the past 3 years for QCOM is significantly above the industry average of 10.75%.
- The last Return On Invested Capital (21.40%) for QCOM is above the 3 year average (17.48%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 11.05% | ||
| ROE | 26.13% | ||
| ROIC | 21.4% |
ROA(3y)14.54%
ROA(5y)18.39%
ROE(3y)32.75%
ROE(5y)52.19%
ROIC(3y)17.48%
ROIC(5y)20.71%
1.3 Margins
- The Profit Margin of QCOM (12.51%) is better than 69.03% of its industry peers.
- QCOM's Profit Margin has declined in the last couple of years.
- Looking at the Operating Margin, with a value of 27.99%, QCOM belongs to the top of the industry, outperforming 87.61% of the companies in the same industry.
- QCOM's Operating Margin has improved in the last couple of years.
- QCOM has a better Gross Margin (55.43%) than 76.11% of its industry peers.
- In the last couple of years the Gross Margin of QCOM has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 27.99% | ||
| PM (TTM) | 12.51% | ||
| GM | 55.43% |
OM growth 3Y-5.8%
OM growth 5Y6.56%
PM growth 3Y-24.67%
PM growth 5Y-12.15%
GM growth 3Y-1.41%
GM growth 5Y-0.7%
2. Health
2.1 Basic Checks
- QCOM has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it is creating value.
- The number of shares outstanding for QCOM has been reduced compared to 1 year ago.
- QCOM has less shares outstanding than it did 5 years ago.
- The debt/assets ratio for QCOM is higher compared to a year ago.
2.2 Solvency
- QCOM has an Altman-Z score of 6.10. This indicates that QCOM is financially healthy and has little risk of bankruptcy at the moment.
- QCOM has a Altman-Z score (6.10) which is comparable to the rest of the industry.
- The Debt to FCF ratio of QCOM is 1.16, which is an excellent value as it means it would take QCOM, only 1.16 years of fcf income to pay off all of its debts.
- QCOM has a better Debt to FCF ratio (1.16) than 73.45% of its industry peers.
- QCOM has a Debt/Equity ratio of 0.70. This is a neutral value indicating QCOM is somewhat dependend on debt financing.
- QCOM has a Debt to Equity ratio of 0.70. This is in the lower half of the industry: QCOM underperforms 75.22% of its industry peers.
- Although QCOM does not score too well on debt/equity it has very limited outstanding debt, which is well covered by the FCF. We will not put too much weight on the debt/equity number as it may be because of low equity, which could be a consequence of a share buyback program for instance. This needs to be investigated.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.7 | ||
| Debt/FCF | 1.16 | ||
| Altman-Z | 6.1 |
ROIC/WACC2
WACC10.71%
2.3 Liquidity
- A Current Ratio of 2.82 indicates that QCOM has no problem at all paying its short term obligations.
- With a Current ratio value of 2.82, QCOM perfoms like the industry average, outperforming 48.67% of the companies in the same industry.
- A Quick Ratio of 2.10 indicates that QCOM has no problem at all paying its short term obligations.
- Looking at the Quick ratio, with a value of 2.10, QCOM is in line with its industry, outperforming 49.56% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.82 | ||
| Quick Ratio | 2.1 |
3. Growth
3.1 Past
- The Earnings Per Share has grown by an nice 17.83% over the past year.
- The Earnings Per Share has been growing by 23.54% on average over the past years. This is a very strong growth
- Looking at the last year, QCOM shows a quite strong growth in Revenue. The Revenue has grown by 13.66% in the last year.
- QCOM shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 15.30% yearly.
EPS 1Y (TTM)17.83%
EPS 3Y-1.35%
EPS 5Y23.54%
EPS Q2Q%11.52%
Revenue 1Y (TTM)13.66%
Revenue growth 3Y0.06%
Revenue growth 5Y15.3%
Sales Q2Q%10.02%
3.2 Future
- The Earnings Per Share is expected to grow by 8.23% on average over the next years. This is quite good.
- Based on estimates for the next years, QCOM will show a small growth in Revenue. The Revenue will grow by 4.71% on average per year.
EPS Next Y2.57%
EPS Next 2Y2.44%
EPS Next 3Y3.3%
EPS Next 5Y8.23%
Revenue Next Year4%
Revenue Next 2Y2.62%
Revenue Next 3Y3.64%
Revenue Next 5Y4.71%
3.3 Evolution
- The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
- The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
- QCOM is valuated correctly with a Price/Earnings ratio of 12.84.
- Based on the Price/Earnings ratio, QCOM is valued cheaply inside the industry as 96.46% of the companies are valued more expensively.
- QCOM's Price/Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 27.25.
- A Price/Forward Earnings ratio of 12.52 indicates a correct valuation of QCOM.
- Based on the Price/Forward Earnings ratio, QCOM is valued cheaply inside the industry as 94.69% of the companies are valued more expensively.
- The average S&P500 Price/Forward Earnings ratio is at 25.98. QCOM is valued rather cheaply when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.84 | ||
| Fwd PE | 12.52 |
4.2 Price Multiples
- Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of QCOM indicates a rather cheap valuation: QCOM is cheaper than 91.15% of the companies listed in the same industry.
- QCOM's Price/Free Cash Flow ratio is rather cheap when compared to the industry. QCOM is cheaper than 94.69% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 12.88 | ||
| EV/EBITDA | 11.8 |
4.3 Compensation for Growth
- The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
- The excellent profitability rating of QCOM may justify a higher PE ratio.
PEG (NY)4.99
PEG (5Y)0.55
EPS Next 2Y2.44%
EPS Next 3Y3.3%
5. Dividend
5.1 Amount
- With a Yearly Dividend Yield of 2.26%, QCOM has a reasonable but not impressive dividend return.
- Compared to an average industry Dividend Yield of 0.49, QCOM pays a better dividend. On top of this QCOM pays more dividend than 92.92% of the companies listed in the same industry.
- QCOM's Dividend Yield is a higher than the S&P500 average which is at 1.82.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.26% |
5.2 History
- The dividend of QCOM is nicely growing with an annual growth rate of 6.56%!
- QCOM has been paying a dividend for at least 10 years, so it has a reliable track record.
- QCOM has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)6.56%
Div Incr Years21
Div Non Decr Years21
5.3 Sustainability
- QCOM pays out 68.67% of its income as dividend. This is not a sustainable payout ratio.
- The dividend of QCOM is growing, but earnings are growing more, so the dividend growth is sustainable.
DP68.67%
EPS Next 2Y2.44%
EPS Next 3Y3.3%
QUALCOMM INC / QCOM FAQ
What is the fundamental rating for QCOM stock?
ChartMill assigns a fundamental rating of 7 / 10 to QCOM.
What is the valuation status for QCOM stock?
ChartMill assigns a valuation rating of 7 / 10 to QUALCOMM INC (QCOM). This can be considered as Undervalued.
What is the profitability of QCOM stock?
QUALCOMM INC (QCOM) has a profitability rating of 8 / 10.
Can you provide the PE and PB ratios for QCOM stock?
The Price/Earnings (PE) ratio for QUALCOMM INC (QCOM) is 12.84 and the Price/Book (PB) ratio is 7.79.
Can you provide the expected EPS growth for QCOM stock?
The Earnings per Share (EPS) of QUALCOMM INC (QCOM) is expected to grow by 2.57% in the next year.