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We Bought Qualcomm When It Was Cheap - Revisiting A Very Successful Investment

Apr. 11, 2021 1:46 PM ETQUALCOMM Incorporated (QCOM)28 Comments
The European View profile picture
The European View


  • As I write this analysis, Qualcomm is down more than 10 percent from its previous high.
  • After the rally in recent months, the short-term and medium-term potential seems limited.
  • In addition, investors should not forget the uncertainties and risks that still hover over Qualcomm.
  • Overall and weighing the future, the stock still offers a good entry opportunity for long-term investors. In the short term, however, the potential could be limited.
Qualcomm company office in Silicon Valley. Qualcomm Incorporated is an American multinational semiconductor and telecommunications equipment company
Photo by Michael Vi/iStock Editorial via Getty Images


When I published the first bullish Qualcomm (NASDAQ:QCOM) analysis here on Seeking Alpha in June 2019, the company was in a heap of trouble. Never-ending feuds with competition authorities led to massive fines. The failed acquisition of NXP Semiconductors for $44

This article was written by

The European View profile picture
Runner of the TEV Blog | Private InvestorI am a long-term oriented investor and in my early thirties. I hold a law degree and a doctorate in law and love investing and talking about my and others' investments. I regularly write about my research and investments on various investor platforms and the TEV Blog. **My articles represent my opinion only and in no way constitute professional investment advice. It is the responsibility of the reader to conduct their due diligence and seek investment advice from a licensed professional before making any investment decisions.**

Analyst’s Disclosure: I am/we are long QCOM, AVGO. 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.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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Comments (28)

nothing is cheap in historical terms
The author compared QCOM to the S&P 500 but the relevant comparison would be QQQ. Could you please compare QCOM performance to QQQ so we can really know how good your investment was?
@metoo5 "Could you please compare QCOM performance to QQQ so we can really know how good your investment was?"

I am not sure why you care. Quite often a stock that has out-performed market indexes in the past, are less likely to continue to outperform them in the future, or at least not outperform at the same rate.

There seems to be a perception my most "investors" these days that stocks that have already risen to dizzying heights will continue that same level of performance in the future, defying the laws of large numbers and common sense. Eventually judgement day (major correction) will arrive for the market, and the high fliers will be hit the hardest.
@Mark_A - I care because the author made a comparison for a reason. And risk should be compensated. QCOM or any of their peers are far more risky than owning QQQ. So yeah, it matters.
@metoo5 I understand that one stock has more risk than a 100 or 500 stock index (no matter what the one stock is). So what? If you want to minimize risk, invest only in a diversified stock index. It doesn't matter whether it is the S&P 500 or QQQ (Nasdaq 100).
I like your article , however it seems to me that you hesitate to offer a decisive opinion. If you suggest to wait for better entry point you are chasing the stock. It is never a good idea to try to purchase a stock at the lowest price possible because you rarely get it at this price. The 5 G is huge , just see the robust bidding for new spectrum and the billions of dollars that the like of V, ATT and TMUS are spending on 5G networks and of course the IPhones sales. All of which bodes well for Qcom. I am long Qcom and I think within 2-3 months it will trade around $170
Abigsoxfan profile picture
One of my longest held investments. Started buying in 1999 at $17.37 on a split adjusted basis. Always buy on the dips, big ones which this is not. Never paid more than $77.50 a share which I did in August of 2014. Last time I bought was in April 2017 at $52.25. I'm a long time bull and perhaps because I own enough, not looking to buy here. Probably wouldn't buy more unless it dips below $100. But for a new investor or one who wants to add to their position, maybe add below $120. We've had a long, long bull market. The current administration is doing things antithetical to a positive economy (higher taxes, more regulations, the mess on the Southern border, stopping pipelines, ruining our energy business, subsidizing "friendly" industries, running up huge deficits, and trying to fundamentally change the positive direction of the country). All that crap could set up a huge drop in the market and this stock. I'd be very nervous adding here. But long term, I love the company and it's treated me well.

Love this comment.

Though, don't get too into the Cassandra mode. Everyone in the markets thinks like this, many are betting this belief, and, well, you know what the markets love to do to what seems so blindingly obvious. Could be awhile.

Gosh, remember when in late 90s before the splits, how we all were fretting massively over at the share price of QCOM amd wondering how much QCOM was appropriate to add? Looking back today, seeing prices and market caps of companies over past 20 years, it's kinda laughable we all felt that anxiety looking at QCOM pre-split prices.

All the best!

The best of fortune to us all
@Abigsoxfan Interesting comment since I bought 1k at $60 avg sp.

I find it hard to believe buying a stock 4 years ago and having a 133% gain + dividends that were 5% when bought, is a bad investment.

The problem with your approach is that you have zero idea of how much profit you left on the table.

By the way, most of the time I buy on the dip but not the once in a lifetime dip.
Abigsoxfan profile picture
@JDoe20 I'm not sure I understand how I left profit on the table.
Me too
55.75 52.50
sspencer profile picture
to apineda7000. Your thoughts are extremely shortsighted. 5G will allow advances in data transmission which will lead to advances that will still be the subject of discovery for the next couple of decades.
Very good. Thank you.
Thanks for the article, I appreciate the point of view.

I am in QCOM from $77; I intend to let it ride for the long term.

Best of luck to all.
Sell buy back at cheaper price...5G play.....most people don’t need or know or understand what 5G mean....Only people on CNBC like something most don’t care....we are spending more and more time at home....no need for 5G at home...
@apineda7000 Do you really understand how 5G is going to change the game? Or you commented just for the sake of commenting?
@Real Gift 5G was last year trade.....2020.....yet to see anything worthwhile....Unless your selling 5G....next play.....6G like China is starting...
pro8 profile picture
@apineda7000 It does not matter that people know, understand, or would they even need to know what 5G is it only matters if they use it and there is no doubt the overwhelming majority will, I never would have believed that someone could come up with such a nonsensical argument but here we are... I guess you are just waiting to run out and buy that latest 3G phone since you think you know so much about these things... let us know how that works out for you....
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