Qualcomm: 3 Different Insiders Have Sold Shares During The Last 30 Days

| About: Qualcomm Inc. (QCOM)

Summary

3 insiders sold Qualcomm stock within one month.

The stock was not purchased by any insiders in the month of intensive selling.

2 of these 3 insiders decreased their holdings by more than 10%.

Qualcomm (NASDAQ:QCOM) designs, develops, manufactures, and markets digital telecommunications products and services.

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Insider selling during the last 30 days

Here is a table of Qualcomm's insider activity during the last 30 days.

Name Title Trade Date Shares Sold Rule 10b5-1 Current Ownership Decrease In Ownership
Paul Jacobs Executive Chairman Mar 27-Apr 4 222,000 Yes 1,342,082 shares + 131,899 options 13.1%
Margaret Johnson EVP April 1 2,400 Yes 24,320 shares + 18,419 options 5.3%
Venkata Renduchintala EVP March 31 51,167 Yes 378 shares 99.3%
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There have been 275,567 shares sold by insiders during the last 30 days. All these shares were sold pursuant to a Rule 10b5-1 plan. More details about the Rule 10b5-1 trading plan can be found from this link.

Insider selling by calendar month

Here is a table of Qualcomm's insider activity by calendar month.

Month Insider selling / shares Insider buying / shares
April 2014 212,400 0
March 2014 312,692 0
February 2014 545,822 0
January 2014 169,592 0
December 2013 175,191 0
November 2013 880,701 0
October 2013 165,009 0
September 2013 379,485 0
August 2013 182,869 0
July 2013 193,088 0
June 2013 144,783 0
May 2013 335,723 0
April 2013 429,250 0
March 2013 412,241 0
February 2013 304,057 0
January 2013 626,003 0
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There have been 5,396,506 shares sold, and there have been zero shares purchased by insiders since January 2013.

Financials

Qualcomm reported the fiscal 2014 second-quarter, which ended March 30, financial results on April 23 with the following highlights:

Revenue $6.4 billion
Net income $2.0 billion
Cash $32.1 billion
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(Source: Earnings presentation)

Outlook

Qualcomm's guidance is as follows:

Q3/FY14 FY14
Revenue $6.2-$6.8 billion $26.0-$27.5 billion
GAAP EPS $0.98-$1.08 $4.37-$4.57
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(Source: Earnings presentation)

Competition

Qualcomm's competitors include Samsung (OTC:SSNLF) and Intel (NASDAQ:INTC). Here is a table comparing these companies.

Company QCOM SSNLF INTC
Market Cap: 131.24B 170.19B 130.62B
Employees: 31,000 N/A 106,300
Qtrly Rev Growth (yoy): 0.10 0.06 0.02
Revenue: 25.47B 219.54B 52.89B
Gross Margin: 0.60 N/A 0.61
EBITDA: 8.49B 50.80B 20.66B
Operating Margin: 0.29 0.16 0.24
Net Income: 6.39B 24.86B 9.52B
EPS: 3.91 189.89 1.87
P/E: 19.86 6.85 14.05
PEG (5 yr expected): 1.00 N/A 1.85
P/S: 5.17 0.78 2.52
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Qualcomm has the highest P/S ratio among these three companies.

Here is a table of Intel's insider activity by calendar month.

Month Insider selling / shares Insider buying / shares
April 2014 54,479 0
March 2014 135,434 0
February 2014 25,742 0
January 2014 729,140 0
December 2013 84,012 0
November 2013 76,427 0
October 2013 893,261 0
September 2013 103,555 0
August 2013 614,086 0
July 2013 207,946 0
June 2013 698,883 0
May 2013 407,416 0
April 2013 110,461 0
March 2013 87,692 0
February 2013 38,928 0
January 2013 47,247 0
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In Intel, there have been 4,314,709 shares sold, and there have been zero shares purchased by insiders since January 2013. Intel has also seen intensive insider selling during the last 30 days.

Conclusion

There have been three different insiders selling Qualcomm, and there have not been any insiders buying Qualcomm during the last 30 days. Two of these three insiders decreased their holdings by more than 10%. Qualcomm has an insider ownership of 1.25%.

Qualcomm has a $72 price target from the Point & Figure chart. I believe there is an opportunity for a short entry with the $72 price target. I would place a stop loss at $82, which is the all-time high. The four main reasons for the proposed short entry are a bearish Point & Figure chart, relatively high P/S ratio, relatively high P/E ratio, and the intensive insider-selling activity.

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Disclosure: I have no positions in any stocks mentioned, but may initiate a short position in QCOM over 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.