QUALCOMM INC (NASDAQ:QCOM) - A Strong Candidate for Long-Term Growth Investors

QUALCOMM INC (NASDAQ:QCOM) stands out as a compelling pick for investors seeking growth at a reasonable price (GARP). The company, a leader in wireless technology, meets key criteria from Peter Lynch’s investment strategy, balancing solid growth, profitability, and a reasonable valuation.

Growth and Valuation

• EPS Growth: Over the past five years, QCOM has delivered an average annual EPS growth of 23.5%, well above the 15% threshold Lynch favors.
• PEG Ratio: At 0.77, the PEG ratio (factoring in past growth) suggests the stock is undervalued relative to its earnings trajectory.
• Reasonable P/E: With a P/E of 13.4, QCOM trades below both the industry average and the S&P 500, offering an attractive entry point.

Financial Health

• Strong Profitability: QCOM’s return on equity (ROE) of 39.8% highlights efficient use of shareholder capital.
• Low Debt: A debt-to-equity ratio of 0.48 indicates a conservative balance sheet, aligning with Lynch’s preference for financially stable companies.
• Liquidity: A current ratio of 2.73 ensures the company can comfortably meet short-term obligations.

Dividend Appeal

QCOM also offers a 2.45% dividend yield, with a sustainable payout ratio of 34% and a track record of consistent payouts for over a decade.

For a deeper look, review the full fundamental analysis of QCOM.

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Disclaimer

This is not investing advice. Always conduct your own research before making investment decisions.