In order to strengthen its market position, Qualcomm Inc. (QCOM: 35.09 +1.18 +3.48%) has been developing various products with innovative features. Qualcomm’s recently acquired Tapioca Mobile, a URL-Linking technology company, is a distinct step in that direction. Terms of the deal were not disclosed.
Tropica Mobile has a product called ‘Magic Link’, which can deliver video or multimedia links, via SMS and MMS, across different social networks and is optimized for any handset, without having to download any link.
Qualcomm has been providing tepid guidance with a sequential decline in revenues for the last four consecutive quarters. Falling royalty rates and an unfavorable product-mix toward low-end handsets and data cards are the reasons behind this decline in revenues.
Total revenue in the second quarter of 2010 summed up to $2.66 billion, up 8.6% year over year, attributable to a healthy demand for Qualcomm chipsets driven by a strong shipment of 3G mobile handsets throughout the world.
Qualcomm maintains a strong balance sheet with over $18.2 billion ($10.85 per share) of cash & marketable securities and no outstanding debt compared with over $17.74 billion of cash & marketable securities and no outstanding debt at the end of second quarter of fiscal 2009.
Qualcomm generated nearly $793 million of cash from operations compared with $1.3 billion in the prior-year quarter. Free cash flow in the same quarter was $685 million compared with $1.03 billion in the year-ago quarter.
Recently, the board of directors of Qualcomm decided to raise the dividend rate by 11.8% from $0.17 per share to $0.19 per share, in addition to an authorization of further $3 billion of share buyback program.
Qualcomm continues to face stiff competition from formidable rivals such as Broadcom Corp. (BRCM: 36.771 +0.471 +1.30%), Nokia Corporation (NOK: 8.41 -0.07 -0.83%), Texas Instruments Inc. (TXN: 24.65 +0.17 +0.69%), ST-Ericsson, and Infineon, as well as from low-cost competitors like Mediatek of Taiwan and VIA Technologies of China.
| Analysts' Targets | |
| Deutsche Bank Securities | $54 |
| Accumulate | |
| Tuesday, March 30, 2010 | |
| Credit Suisse | $45 |
| Outperformer | |
| Friday, March 26, 2010 | |
| J.P. Morgan Securities | $48 |
| Buy | |
| Friday, March 26, 2010 | |
| Rodman & Renshaw Inc. | $50 |
| Outperform | |
| Thursday, March 25, 2010 | |
| Jefferies & Co. | $48 |
| Accumulate | |
| Friday, February 12, 2010 | |
| Hilliard Lyons | $52 |
| Accumulate | |
| Friday, January 29, 2010 | |
| RBC Capital Markets | $55 |
| Sector Perform | |
| Thursday, January 28, 2010 | |
| ThinkPanmure, LLC | $42 |
| Buy | |
| Thursday, January 28, 2010 | |
| JMP Securities LLC | $60 |
| Mkt Outperform | |
| Tuesday, January 05, 2010 | |
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