Qualcomm (QCOM) closed at $137.30 in the latest trading session, marking a -0.1% move from the prior day. This change lagged the S&P 500’s 0.33% gain on the day.
Coming into today, shares of the chipmaker had gained 8.15% in the past month. In that same time, the Computer and Technology sector gained 5.19%, while the S&P 500 gained 4.77%.
Investors will be hoping for strength from QCOM as it approaches its next earnings release, which is expected to be April 28, 2021. On that day, QCOM is projected to report earnings of $1.67 per share, which would represent year-over-year growth of 89.77%. Our most recent consensus estimate is calling for quarterly revenue of $7.63 billion, up 46.2% from the year-ago period.
QCOM’s full-year Zacks Consensus Estimates are calling for earnings of $7.35 per share and revenue of $31.09 billion. These results would represent year-over-year changes of +75.42% and +32.1%, respectively.
Investors should also note any recent changes to analyst estimates for QCOM. Recent revisions tend to reflect the latest near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company’s business outlook.
Our research shows that these estimate changes are directly correlated with near-term stock prices. 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, 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 remained stagnant. QCOM is currently a Zacks Rank #3 (Hold).
Investors should also note QCOM’s current valuation metrics, including its Forward P/E ratio of 19.14. Its industry sports an average Forward P/E of 20.64, so we one might conclude that QCOM is trading at a discount comparatively.
We can also see that QCOM currently has a PEG ratio of 0.94. 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 Wireless Equipment industry currently had an average PEG ratio of 1.85 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 77, putting it in the top 31% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our 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.