Pull out your cell phone -- Qualcomm (QCOM - Get Report) probably had something to do with it. The $107 billion semiconductor and wireless technology firm developed the patents behind standards like CDMA, 3G, and 4G -- and the firm makes money on every device that's built to work over those standards. So while mobile device makers battle it out in a highly competitive industry, Qualcomm makes money no matter whose phone you buy.
R&D is the lynchpin of Qualcomm's business. It fuels the licensing revenue that the company generates (around 3% to 5% of retail prices for each handset sold), as well as the more competitive semiconductor business. As smartphone sales continue to rocket, the firm should benefit even more by providing its next-generation chips for OEMs such as Apple (AAPL) and HTC.Qualcomm is in stellar financial shape, with a massive amount of cash on its balance sheet and no long-term debt. That dry powder should help the firm keep paying out R&D costs as well as a modest dividend payout. On Tuesday, management announced a 16.28% dividend increase that brings QCOM's quarterly dividend to 25 cents per share. Qualcomm, one of Maverick Capital's holdings, shows up on recent lists of the 10 Most Popular Hedge Fund Stock Picks and 4 Stocks Poised for an Apple iPad 3 Boost. Follow @stockpickr
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