Qualcomm Inc. Stock Buy Recommendation Reiterated (QCOM)

Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.

NEW YORK ( TheStreet) -- Qualcomm (Nasdaq: QCOM) has been reiterated by TheStreet Ratings as a buy with a ratings score of A- . The company's strengths can be seen in multiple areas, such as its robust revenue growth, increase in stock price during the past year, growth in earnings per share and compelling growth in net income. We feel these strengths outweigh the fact that the company shows weak operating cash flow.

  • EXCLUSIVE OFFER: Jim Cramer's Protégé, Dave Peltier, only buys Stocks Under $10 that he thinks could potentially double. See what he's trading today with a 14-day FREE pass

Highlights from the ratings report include:
  • The revenue growth came in higher than the industry average of 5.8%. Since the same quarter one year prior, revenues rose by 18.3%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • The stock has risen over the past year as investors have generally rewarded the company for its earnings growth and other positive factors like the ones we have cited in this report. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.
  • QUALCOMM INC has improved earnings per share by 16.1% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, QUALCOMM INC increased its bottom line by earning $3.06 versus $2.71 in the prior year. This year, the market expects an improvement in earnings ($4.29 versus $3.06).
  • The net income growth from the same quarter one year ago has greatly exceeded that of the S&P 500, but is less than that of the Communications Equipment industry average. The net income increased by 20.4% when compared to the same quarter one year prior, going from $1,056.00 million to $1,271.00 million.
  • Net operating cash flow has decreased to $1,409.00 million or 22.58% when compared to the same quarter last year. In conjunction, when comparing current results to the industry average, QUALCOMM INC has marginally lower results.

QUALCOMM Incorporated designs, develops, manufactures, and markets digital telecommunications products and services. Qualcomm has a market cap of $103.38 billion and is part of the technology sector and telecommunications industry. The company has a P/E ratio of 19.8, above the S&P 500 P/E ratio of 17.7. Shares are up 10.9% year to date as of the close of trading on Friday.

You can view the full Qualcomm Ratings Report or get investment ideas from our investment research center.

--Written by a member of TheStreet Ratings Staff.

FREE for a limited time only: Get TheStreet Ratings #1 Stock Report NOW!
null

If you liked this article you might like

Facebook and Snap Have One Issue That Will Have to Be Solved: Peter Bonfield

10 Biggest Takeaways from Apple's iPhone X Event

Google Pixel 2 Debuting October 4, FYI Apple

The iPhone X Highlights This Overlooked Strength of Apple's

Arconic, Idexx Laboratories, AbbVie: 'Mad Money' Lightning Round