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Intel (NASDAQ:INTC) used to be the alpha dog in the semiconductor space. That was back in the day when personal computers were all the rage and Intel held a dominant position in building the processors that made those machines work. Today, it is still a major player but the landscape is not what it used to be.

Intel didn't respond quickly enough when the world was choosing smaller mobile devices over the traditional PC and now Qualcomm (NASDAQ:QCOM) has swept in and taken a leadership position in producing the components that power many smartphones and tablets. While Intel is dedicating billions of dollars to R&D and the upcoming Haswell chip seems to show a great deal of promise, the fact of the matter remains that Qualcomm is the leader in the chip market for mobile devices and Intel currently has very little presence in the space.

Intel's attempts to infiltrate the mobile space thus far have been met with mixed results. The Ultrabook was supposed to take a shot at unseating Apple (NASDAQ:AAPL) in the ultra-thin netbook market but sales to this point have been disappointing. It was thought that the rising tide of Microsoft's (NASDAQ:MSFT) Windows 8 operating system launch would help lift Intel's boat as well but that too failed to provide a boost to the PC market. Intel now rests its hope on its new 22 nanometer mobile chip design currently scheduled to debut this fall.

Whereas Intel is now in the position of dedicating significant dollars to try to break into the mobile chip market, Qualcomm is already there. It was among the first to anticipate the big move to mobile devices and as such was one of the first to develop the mobile chips that currently support many smartphone and tablet devices. Today, this report indicates that Qualcomm currently has an 86% share of the LTE modem market. Those sound like the kind of numbers that Intel would have in the PC space.

Qualcomm is not without its own challenges. Where Intel is trying to crack into the mobile chip market, Qualcomm needs to make progress gaining share in the chip market for tablets. Apple controls that space for the most part and an expansion into that market could mean huge bottom line revenue. Google's (NASDAQ:GOOG) Nexus 7 tablet will be using Qualcomm's Snapdragon processor so it's not difficult to see the company expanding based on that relationship alone.

Intel, for its part, reported earnings and revenue for the 1st quarter that met already tepid expectations. The company also held firm to existing 2nd-quarter guidance although the direction of Intel's numbers along with the continued deterioration of the PC market make it a question of whether or not Intel will be able to hit those numbers. The grim reality for Intel is that while its position in the enterprise space is strong and the revenues from its data center business are improving, the company is struggling to grow and earnings are falling. Earnings per share in the most recent quarter were down 26% compared to this quarter last year.

Qualcomm on the other hand appears to have the wind at its back. Its quarterly earnings growth is 36% and it's expected to grow almost 15% a year for the next five years. Qualcomm's forward P/E of 13.2 and price to book ratio of 3.2 are a little richer than Intel's P/E ratio of 10.6 and price to book ratio of 2.1, respectively, but being in a current high growth phase those ratios are sustainable. Qualcomm's 30% operating margin also suggests an ability to sustain a higher valuation.

Even Qualcomm's management team will acknowledge that it is still not the type of household name that Intel is but if the company continues growing the way it has and is able to maintain its significant market share in mobile chips it won't be long before that's no longer the case. The fundamentals suggest that the stock price is still relatively fairly valued given its growth forecasts, potential synergies coming from Google's Nexus 7 tablet launch and ability to generate revenue. Qualcomm reports its own 1st-quarter earnings on April 24th.

There's a battle going on the semiconductor sector. It may be Qualcomm that ends up coming out on top.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.