QUALCOMM INC (NASDAQ:QCOM): good value for what you're paying.

Our stock screener has singled out QUALCOMM INC (NASDAQ:QCOM) as a stellar value proposition. NASDAQ:QCOM not only scores well in profitability, solvency, and liquidity but also maintains a very reasonable price point. We'll explore this further.

Exploring NASDAQ:QCOM's Valuation

ChartMill employs its own Valuation Rating system for all stocks. This score, ranging from 0 to 10, is determined by evaluating different valuation factors, including price to earnings and free cash flow, both in absolute terms and relative to the market and industry. NASDAQ:QCOM has earned a 7 for valuation:

• Compared to the rest of the industry, the Price/Earnings ratio of QCOM indicates a rather cheap valuation: QCOM is cheaper than 87.04% of the companies listed in the same industry.
• Compared to an average S&P500 Price/Earnings ratio of 29.41, QCOM is valued rather cheaply.
• Based on the Price/Forward Earnings ratio, QCOM is valued cheaply inside the industry as 90.74% of the companies are valued more expensively.
• QCOM is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 22.12, which is the current average of the S&P500 Index.
• QCOM's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. QCOM is cheaper than 77.78% of the companies in the same industry.
• Based on the Price/Free Cash Flow ratio, QCOM is valued cheaper than 97.22% of the companies in the same industry.
• QCOM's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
• QCOM has an outstanding profitability rating, which may justify a higher PE ratio.

Analyzing Profitability Metrics

ChartMill utilizes a Profitability Rating to assess stocks, scoring them on a scale of 0 to 10. This rating takes into account a variety of profitability ratios and margins, both in absolute terms and in comparison to industry peers. NASDAQ:QCOM has earned a 9 out of 10:

• The Return On Assets of QCOM (18.99%) is better than 92.59% of its industry peers.
• QCOM has a better Return On Equity (39.27%) than 93.52% of its industry peers.
• QCOM has a Return On Invested Capital of 18.89%. This is amongst the best in the industry. QCOM outperforms 91.67% of its industry peers.
• Measured over the past 3 years, the Average Return On Invested Capital for QCOM is significantly above the industry average of 11.47%.
• QCOM has a Profit Margin of 25.94%. This is amongst the best in the industry. QCOM outperforms 87.04% of its industry peers.
• In the last couple of years the Profit Margin of QCOM has grown nicely.
• Looking at the Operating Margin, with a value of 26.80%, QCOM belongs to the top of the industry, outperforming 86.11% of the companies in the same industry.
• In the last couple of years the Operating Margin of QCOM has grown nicely.
• QCOM has a Gross Margin of 55.99%. This is in the better half of the industry: QCOM outperforms 76.85% of its industry peers.

Unpacking NASDAQ:QCOM's Health Rating

ChartMill employs a unique Health Rating system for all stocks. This rating, ranging from 0 to 10, is determined by analyzing various liquidity and solvency ratios. For NASDAQ:QCOM, the assigned 7 for health provides valuable insights:

• An Altman-Z score of 5.97 indicates that QCOM is not in any danger for bankruptcy at the moment.
• Looking at the Altman-Z score, with a value of 5.97, QCOM is in the better half of the industry, outperforming 66.67% of the companies in the same industry.
• The Debt to FCF ratio of QCOM is 1.14, which is an excellent value as it means it would take QCOM, only 1.14 years of fcf income to pay off all of its debts.
• The Debt to FCF ratio of QCOM (1.14) is better than 75.00% of its industry peers.
• QCOM has a Debt/Equity ratio of 0.49. This is a healthy value indicating a solid balance between debt and equity.
• Although QCOM does not score too well on debt/equity it has very limited outstanding debt, which is well covered by the FCF. We will not put too much weight on the debt/equity number as it may be because of low equity, which could be a consequence of a share buyback program for instance. This needs to be investigated.
• QCOM has a Current Ratio of 2.62. This indicates that QCOM is financially healthy and has no problem in meeting its short term obligations.

Evaluating Growth: NASDAQ:QCOM

ChartMill assigns a proprietary Growth Rating to each stock. The score is computed by evaluating various growth aspects, like EPS and revenue growth. We take into account the history as well as the estimated future numbers. NASDAQ:QCOM was assigned a score of 6 for growth:

• The Earnings Per Share has grown by an impressive 23.66% over the past year.
• Measured over the past years, QCOM shows a very strong growth in Earnings Per Share. The EPS has been growing by 23.53% on average per year.
• The Revenue has grown by 12.13% in the past year. This is quite good.
• Measured over the past years, QCOM shows a quite strong growth in Revenue. The Revenue has been growing by 14.76% on average per year.
• Based on estimates for the next years, QCOM will show a quite strong growth in Earnings Per Share. The EPS will grow by 10.61% on average per year.

Every day, new Decent Value stocks can be found on ChartMill in our Decent Value screener.

For an up to date full fundamental analysis you can check the fundamental report of QCOM

Keep in mind

Important Note: The content of this article is not intended as trading advice. It is essential to perform your own analysis and exercise caution when making trading decisions. The article presents observations created by automated analysis but does not guarantee any trading or investment outcomes. Always trade responsibly and make independent judgments.