QCOM – Market expectations are for Uniform ROA improvement, but management may have concerns about inventories, revenue growth, and supply chain headwinds

• QUALCOMM Incorporated (QCOM:USA) currently trades above historical averages relative to UAFRS-based (Uniform) earnings, with a 22.0x Uniform P/E. At these levels, markets have bullish expectations for the firm, but management may have concerns about potential inventory channel build-up, revenue growth, and semiconductor supply chain headwinds
  
  
• Specifically, management may lack confidence in their ability to sustain revenue growth, particularly in IoT solutions, and capitalize on the expansion of Qualcomm CDMA Technologies’ addressable market. Moreover, they may be downplaying concerns about potential channel inventory build, semiconductor industry supply chain headwinds, and revenue seasonality. Furthermore, management may lack confidence in their ability to continue investing in 5G-related technology, provide algorithmic advancements and software tools for developers and OEMs, and take advantage of Huawei’s strong design activity. In addition, they may be concerned about the pace of the recovery of the handset market and the sustainability of semiconductor demand. Finally, management may lack confidence in their ability to manage legal costs, accelerate market share gains, and maintain a strong industry position