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Qualcomm (QCOM) Dips More Than Broader Markets: What You Should Know

Zacks Equity Research

Qualcomm (QCOM) closed at $75.35 in the latest trading session, marking a -0.69% move from the prior day. This change lagged the S&P 500's daily loss of 0.53%. Elsewhere, the Dow lost 0.47%, while the tech-heavy Nasdaq lost 1%.

Prior to today's trading, shares of the chipmaker had gained 1.23% over the past month. This has lagged the Computer and Technology sector's gain of 3.84% and the S&P 500's gain of 2.68% in that time.

QCOM will be looking to display strength as it nears its next earnings release, which is expected to be July 31, 2019. In that report, analysts expect QCOM to post earnings of $0.76 per share. This would mark a year-over-year decline of 24.75%. Our most recent consensus estimate is calling for quarterly revenue of $5.11 billion, down 8.7% from the year-ago period.

QCOM's full-year Zacks Consensus Estimates are calling for earnings of $3.84 per share and revenue of $20.45 billion. These results would represent year-over-year changes of +4.07% and -10.02%, respectively.

Investors should also note any recent changes to analyst estimates for QCOM. These revisions help to show the ever-changing nature of near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

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. Over the past month, the Zacks Consensus EPS estimate has moved 0.22% higher. QCOM is currently sporting a Zacks Rank of #4 (Sell).

Investors should also note QCOM's current valuation metrics, including its Forward P/E ratio of 19.76. Its industry sports an average Forward P/E of 23.53, so we one might conclude that QCOM is trading at a discount comparatively.

Investors should also note that QCOM has a PEG ratio of 1.41 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 2.97 as of yesterday's close.

The Wireless Equipment industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 58, putting it in the top 23% 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.

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

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