Cautious Qualcomm Analyst Call Sounds Positive (QCOM, AAPL)

Qualcomm Inc. (NASDAQ: QCOM) is being maintained as “neutral” in a call by Zacks Investment Research, which frankly is just on valuation and because of prior stock moves higher.  If you just read the commentary it all sounds positive.

Zacks noted that Qualcomm continues with its dream performance and high earnings marks, with net income up 20% from a year ago and up 33% sequentially.  The report noted, “Management is quite confident that the company will be able to maintain its current pace of revenue and earnings growth for at least next five years.”

Four drivers of the positive management outlook:

(1) gradual introduction of 4G LTE enabled mobile handsets in the developed markets of the U.S., Japan, and South Korea

(2) massive growth of 3G smartphones in the emerging markets, particularly in China, where the company has strong foothold

(3) Qualcomm’s growing association with Apple Inc. (NASDAQ: AAPL) for its iPhones and iPADs and

(4) a diversified product portfolio.However, the stock price has soared nearly 33% in the last six months. We thus reaffirm our Neutral recommendation on the stock.