Thursday, 3 September 2015

Some Reasons To Invest In Qualcomm Inc.

Some of the reasons that compel financial investors to invest in the telecommunication company, Qualcomm Inc.
QUALCOMM Inc. (NASDAQ:QCOM), a telecommunication company and one of the finest mobile-chip manufacturing organization, suffered from a tough year. Samsung, which is the one of its returning customer, dropped its contract for the Snapdragon chips and wireless modems from its flagship Galaxy S6 smartphones for the in-house components. It also faces rising rivalry from comparatively inexpensive competitors, such as RockChip and MediaTek, which introduce many below-average devices in the emanating market.
Those challenges tend Qualcomm to cut down the high-end of its financial for the current year turnovers reported at $1.5 billion during the past quarter. It is not surprising that the company’s stock has fallen by 20% from the starting of the year. Nevertheless, after that fall, the stock seems to have a strong long-lasting financial investment for some reasons.
The technology licensing organization business, which put forward CDMA technologies to handset vendors all over the world, entitles the company to cut wholesale price of the smartphone from 3% to 5%.
The unit reported 86% of pre-tax earnings of the telecommunication company regarding its last quarter against only achieving a third of its turnovers. The unit has also been progressing at a high rate as compared to the Qualcomm CDMA Technologies chip-making business. The QTL unit’s turnover and pre-tax incomes both showed an upward trend of around 7% yearly throughout the last quarter against the fall of 22% in the QCT unit and 74% dive in pre-tax incomes.
Throughout the last 12 months, the organization paid out around 65% of its cash flow as dividends, compared to Intel’s FCF payout ratio of 41%. This indicates that both the chipmaking businesses have the potential to raise their dividends in the stock market.
Qualcomm performance during the last 12 years showed an elevation with consistency, the association has improved its dividends per year with the average of 22% during the last 4 years. It currently put forward a yearly dividend income of 3.5%, at the same time INTC yielded 3.7%. Both yields are extremely higher against the average of S&P 500 yield of 2.15%.
Currently, the company plans to transform the prime cellphone market by spreading its roots into the market of Internet of Things (IoT). According to IDC, it is expected that the market, which depends on everyday gadgets linked to each other, will grow more than 7.1 trillion by 2020. Many tech giants are striving after the IoT to dominate the tech market and stay ahead of competition.

Tuesday, 1 September 2015

Baird Equity Research Upgraded Bank Of America Corp Stock

Baird Equity Research suggests a Buy on Bank of America stock, while upgrading SunTrust to Neutral.
Bank of America Corp. stock has been raised to Outperform rating, similar to a Byrating at Baird Equity research firm. David A George, Evan Marks and Garrett A Holland, analysts at the sell-side firm revealed the rating upgrade in a research note with a title “From Euphoria to Panic in a Week.”
Investors are recommended to use the current sentiments and pullback in the stock market to shut their short position and buying BofA stocks. Bank of America’s tangible book-value’s discounted valuation shows that the stock has a sufficient margin of growth and safety in its book value. This is believed to increase the shares value in the non-existence of interest rate increase by Fed and until potential growth viewpoint improves.
The report discusses the much addressed problem of undervaluing the interest rate option. Shareholders are suggested to buy bank stocks, however the consensus on increase of increase rate is that it will going to be announced. This shows that the American bank’s net interest income might drop below the quarterly run rate of $10 billion. So as to battle the issue of low interest rate, the bank is looking to adopt cost cutting steps in the coming year and enhance its return. BofA, like other large banks that find it difficult to enhance their bottom line, has been on cost cutting path for quite a long time now.
As much as the regulatory capital is concerned, however it’s less than the bank’s peer, the experts believed that the bank’s shareholders should accept the deliberate pace of capital return. A stock price target of $18 on the company’s stock for the upcoming 12 to 18 months is expected. With the improvement in macro level environment, BofA is most likely to enhance its loan growth and increase its earnings by 25 cents per share, if the interest rate increases by almost 100 basis points.
In news, the research report also upgraded SunTrust Inc. stock to a Neutral. Because of improving loan growth and operating leverage, the bank is recommended to extend its valuation to approximately 13 times the fiscal year 2016 EPS.
Recently, Keefe, Bruyette & Woods upgraded Bank of America. Christopher Mustacio, an analyst now assigns an Outperform rating to the company’s stock with $20 price target.
According to the analysts polled by Bloomberg, 25 suggest a Buy, while only 3 recommend a Sell. The twelve month consensus stock price target stands at $19.36.