Qualcomm Inc (QCOM, Financial) has recently been in the spotlight, drawing interest from investors and financial analysts due to its robust financial stance. With shares currently priced at $154.31, Qualcomm Inc has witnessed a daily gain of 1.55%, marked against a three-month change of 37.42%. A thorough analysis, underlined by the GF Score, suggests that Qualcomm Inc is well-positioned for substantial growth in the near future.
What Is the GF Score?
The GF Score is a stock performance ranking system developed by GuruFocus. It evaluates stocks based on five key aspects: financial strength, profitability, growth, value, and momentum. These aspects have been closely correlated to the long-term performances of stocks, as evidenced by backtesting from 2006 to 2021. Stocks with higher GF Scores typically generate higher returns. The GF Score ranges from 0 to 100, with 100 indicating the highest potential for outperformance.
- Financial strength rank: 7/10
- Profitability rank: 9/10
- Growth rank: 9/10
- GF Value rank: 5/10
- Momentum rank: 10/10
With a high GF Score of 92 out of 100, Qualcomm Inc is signaled to have the highest outperformance potential, with particularly strong showings in profitability, growth, and momentum.
Understanding Qualcomm Inc's Business
Qualcomm Inc, with a market cap of $172.34 billion and sales of $35.82 billion, is a leading force in the wireless technology industry. The company's operating margin stands at 20.94%, reflecting its efficiency in managing expenses relative to its revenue. Qualcomm develops and licenses wireless technology and designs chips for smartphones, with key patents in CDMA and OFDMA technologies that are essential for 3G, 4G, and 5G networks. Its intellectual property is licensed by virtually all wireless device makers. As the world's largest wireless chip vendor, Qualcomm supplies top-tier handset makers with advanced processors and also ventures into automotive and Internet of Things markets.
Financial Strength Breakdown
Qualcomm Inc's Financial Strength is a testament to its solid balance sheet and prudent capital management. The company's Interest Coverage ratio of 10.81 indicates a strong ability to meet interest obligations, aligning with the principles of legendary investor Benjamin Graham. Furthermore, an Altman Z-Score of 5.56 places Qualcomm Inc in a secure position against financial distress. The Debt-to-Revenue ratio of 0.43 showcases the company's strategic debt management, reinforcing its financial health.
Profitability Rank Breakdown
The Profitability Rank of 9/10 for Qualcomm Inc underscores its exceptional ability to generate profits compared to its industry peers. This high rank reflects the company's effective cost control and revenue generation strategies, which contribute to its strong bottom line.
Growth Rank Breakdown
Qualcomm Inc's high Growth Rank demonstrates its commitment to business expansion. The company's 3-Year Revenue Growth Rate of 15.8% surpasses 58.81% of competitors in the Semiconductors industry. Additionally, Qualcomm Inc's EBITDA has seen significant growth, with a three-year growth rate of 9.6 and a five-year rate of 34.1, highlighting its sustained growth capabilities.
Conclusion: Qualcomm Inc's Position for Outperformance
Considering Qualcomm Inc's financial strength, profitability, and growth metrics, the GF Score highlights the firm's unparalleled position for potential outperformance. These factors, combined with the company's strategic market position and innovative technology, make Qualcomm Inc a compelling choice for investors seeking growth and stability.
GuruFocus Premium members can find more companies with strong GF Scores using the following screener link: GF Score Screen
This article, generated by GuruFocus, is designed to provide general insights and is not tailored financial advice. Our commentary is rooted in historical data and analyst projections, utilizing an impartial methodology, and is not intended to serve as specific investment guidance. It does not formulate a recommendation to purchase or divest any stock and does not consider individual investment objectives or financial circumstances. Our objective is to deliver long-term, fundamental data-driven analysis. Be aware that our analysis might not incorporate the most recent, price-sensitive company announcements or qualitative information. GuruFocus holds no position in the stocks mentioned herein.
