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Qorvo (QRVO) Dips More Than Broader Markets: What You Should Know

Zacks Equity Research
·3 min read

Qorvo (QRVO) closed at $127.36 in the latest trading session, marking a -1.81% move from the prior day. This move lagged the S&P 500's daily loss of 1.21%. Meanwhile, the Dow lost 0.59%, and the Nasdaq, a tech-heavy index, lost 2.45%.

Heading into today, shares of the chipmaker had lost 3.98% over the past month, lagging the Computer and Technology sector's gain of 0.77% and the S&P 500's loss of 0.71% in that time.

QRVO will be looking to display strength as it nears its next earnings release, which is expected to be November 4, 2020. In that report, analysts expect QRVO to post earnings of $2.14 per share. This would mark year-over-year growth of 40.79%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $1.01 billion, up 25.35% from the year-ago period.

QRVO's full-year Zacks Consensus Estimates are calling for earnings of $7.06 per share and revenue of $3.55 billion. These results would represent year-over-year changes of +11.53% and +9.52%, respectively.

Investors should also note any recent changes to analyst estimates for QRVO. Recent revisions tend to reflect the latest near-term business trends. 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. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. The Zacks Consensus EPS estimate remained stagnant within the past month. QRVO is holding a Zacks Rank of #1 (Strong Buy) right now.

In terms of valuation, QRVO is currently trading at a Forward P/E ratio of 18.37. This valuation marks a discount compared to its industry's average Forward P/E of 21.36.

Investors should also note that QRVO has a PEG ratio of 1.49 right now. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Semiconductors - Radio Frequency was holding an average PEG ratio of 1.59 at yesterday's closing price.

The Semiconductors - Radio Frequency industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 47, putting it in the top 19% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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