The most recent trading session ended with Qualcomm (QCOM – Free Report) standing at $158.52, reflecting a -0.53% shift from the previouse trading day’s closing. This move lagged the S&P 500’s daily loss of 0.04%. At the same time, the Dow added 0.07%, and the tech-heavy Nasdaq lost 0.05%.
Coming into today, shares of the chipmaker had gained 1.89% in the past month. In that same time, the Computer and Technology sector gained 5.93%, while the S&P 500 gained 1.05%.
Investors will be eagerly watching for the performance of Qualcomm in its upcoming earnings disclosure. On that day, Qualcomm is projected to report earnings of $2.92 per share, which would represent year-over-year growth of 6.18%. In the meantime, our current consensus estimate forecasts the revenue to be $10.89 billion, indicating a 9.61% growth compared to the corresponding quarter of the prior year.
For the full year, the Zacks Consensus Estimates project earnings of $11.14 per share and a revenue of $42.19 billion, demonstrating changes of +9% and +8.29%, respectively, from the preceding year.
Additionally, investors should keep an eye on any recent revisions to analyst forecasts for Qualcomm. These revisions help to show the ever-changing nature of near-term business trends. Consequently, upward revisions in estimates express analysts’ positivity towards the company’s business operations and its ability to generate profits.
Our research shows that these estimate changes are directly correlated with near-term stock prices. 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. Over the past month, the Zacks Consensus EPS estimate has shifted 0.45% upward. Qualcomm presently features a Zacks Rank of #2 (Buy).
In terms of valuation, Qualcomm is currently trading at a Forward P/E ratio of 14.3. For comparison, its industry has an average Forward P/E of 16.58, which means Qualcomm is trading at a discount to the group.
We can additionally observe that QCOM currently boasts a PEG ratio of 2.18. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company’s expected earnings growth trajectory. By the end of yesterday’s trading, the Wireless Equipment industry had an average PEG ratio of 3.42.
The Wireless Equipment industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 45, putting it in the top 18% of all 250+ industries.
The Zacks Industry Rank assesses the vigor of our specific industry groups by computing the average Zacks Rank of the individual stocks incorporated in the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Keep in mind to rely on Zacks.com to watch all these stock-impacting metrics, and more, in the succeeding trading sessions.
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