QCOM – Market expectations are for Uniform ROA to fade; management may have concerns about product launches, growth opportunities, and profitability

January 26, 2022

  • QUALCOMM (QCOM) currently trades below corporate and near historical averages relative to Uniform earnings, with a 17.0x Uniform P/E (Fwd. V/E’).
  • At these levels, markets are pricing in expectations for Uniform ROA to fade to 26%, accompanied by 5% Uniform asset growth.
  • However, analysts expect Uniform ROA to further improve to 34% in 2023, accompanied by 1% Uniform asset shrinkage.
  • If sustained going forward, these levels would imply a stock price closer to $192, representing marginal equity upside for the firm.
  • That said, the firm’s most recent earnings call suggests management may have concerns about product launches, growth opportunities, and profitability.

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