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Short Selling Analysis : QUALCOMM, Inc. (NASDAQ:QCOM) May Reach $ 60 Easily !

|Includes: Qualcomm Inc. (QCOM)

Short Selling Analysis : QUALCOMM, Inc. (NASDAQ:QCOM) May Reach $ 60 Easily !

#ShortSelling Alert : QUALCOMM, Inc. .

Samsung's Galaxy S6 seems to be Qualcomm (NASDAQ: QCOM ) -free, according to a teardown performed by Chipworks (via Reuters). The S6 uses a Samsung-designed system-on-chip, Samsung modem, RF transceiver, and envelope tracking chip.

This is bad news for Qualcomm's positioning at Samsung. Further, given that the S6 seems to be the best reviewed of this round of Android flagship devices, Qualcomm's high-end chip business looks like it's facing some pretty stiff competition.

In Addition :

Samsung Galaxy dropped Qualcomm for both the AP and modem.

Intel 64-bit SoCs with integrated modems now in the market.

iPhone 7 rumored to be using Intel modem instead of Qualcomm for some models.

Competition is starting to hurt Qualcomm and I expect a rash of earnings downgrade to follow as the trend gathers steam.

India set have to a 4G subscriber base of 100 million by 2020.Qualcomm may not benefit fully from India's four-mode standards.

Recently, various executives have taken part in insider selling activity for the stocks of QUALCOMM, Inc. !

The company has a one year high of $80.58 and a one year low of $61.90. Currently, Qualcomm Inc. has an average volume of 13.16M.

Shares of Qualcomm (NASDAQ: ) have been under pressure over the recent months on concerns such as commoditization of LTE chips, intensifying competition in China, and the rapid growth of downmarket chip king MediaTek.

Qualcomm Inc is now under the scanner of the local Chinese government on allegations of trademark transgressions by a local Chinese company, Genitop. The local player has requested the Chinese government investigate and fine the U.S.-based chipmaker the ridiculous amount of $100 billion for the alleged transgression.

In February, Qualcomm, Inc. agreed to pay a fine of $975 million to the Chinese government for alleged monopolistic practices, based on its patent licensing business.

The decay of Qualcomm's core business segment is due to four main factors: evolving technology, legal woes, vendor fraud, and price decreases.

Qualcomm faces a non-negligible amount of licensing revenue loss due to Chinese vendors underreporting device sales.

Qualcomm's licensing revenues are significantly exposed to the price of smartphones. Rather than playing a flat rate, Qualcomm takes a percentage of the selling price of the device.

As smartphone developers expand and saturate emerging markets, it is inevitable that the cost of these devices decrease to account for the disparity in income levels.

Recent reports have also suggested that Apple (OTC:APPL) will be replacing Qualcomm's hardware with the new Intel 7360 LTE chip in 2016 iPhone shipments to Asia and Latin America. This is particularly troublesome given Qualcomm's revenue structure.

Disclosure: The author has no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.