Morningstar Rating

Stock Research and Analysis

by Brian Colello, CPA

Bulls Say

Qualcomm collects royalty income on the substantial majority of 3G and 4G handsets sold, as it holds virtually all essential patents used in these networks.
Qualcomm is the clear market leader in wireless chips, with a dominant share in 4G LTE chipsets and design wins into virtually every premium handset on the market today.
Qualcomm's Snapdragon chips, which include both the processor needed to run a phone's operating system and baseband functionality needed to connect the phone to wireless networks, have unmatched integration today. Read more 

Bears Say

China's investigation into Qualcomm's licensing business and the firm's difficulties in collecting royalty revenue from Chinese handset makers adds uncertainty and risk to what is otherwise a steadily growing business.
Qualcomm’s latest Snapdragon 810 processor was bypassed by Samsung for its upcoming smartphone launch, and we don’t anticipate that the company will regain its position within Samsung’s flagship phones anytime soon.
Qualcomm's licensing revenue has suffered from time to time due to currency effects, price competition, and an unfavorable handset product mix. Read more 

Management

We view Qualcomm as a well-run organization and good stewards of shareholder capital. Steve Mollenkopf took over the CEO role in March after more than 20 years with the company, proving himself as a capable leader during his tenure running Qualcomm's   Read more 

Profile

Qualcomm develops and licenses wireless technology and manufactures semiconductors for mobile phones. The company's key patents revolve around CDMA and OFDMA technologies,  Read more 

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