Qualcomm (QCOM)

Financial Statement Analysis

Daniel Campbell
Zeeshan Halim
Saurabh (Sam) Srivastava
Yucheng Mao

Analysis of the Context

Industry: Semiconductor
Combined industry sales, 2013: $300+ billion US
Largest Supplier: Intel (~20% market share)
Major Suppliers: Samsung, Qualcomm, Micron, TSMC
Major Purchasers: Samsung, Apple, Huawei, Google

Industry information collected from:

Handy, Jim. (2013). <<Semiconductors A Crazy Industry>>, [online] http://www.forbes.com/sites/jimhandy/2014/02/11/semiconductors-a-crazy-industry-2/

Analysis of the Firm

Est. 1985. HQ in San Diego, CA.
157 locations. 31,000 employees.
Listed on NASDAQ, S&P 500
3rd largest semiconductor supplier in 2013
Main business line: 3G, 4G (LTE)
Next business line: LTE in unlicensed radio network
Major customers:
Apple, Google, Samsung, Lenovo, Huawei

Industry information collected from:

Handy, Jim. (2013). <<Semiconductors A Crazy Industry>>, [online] http://www.forbes.com/sites/jimhandy/2014/02/11/semiconductors-a-crazy-industry-2/

Financial Analysis

Revenue:
$24.88B
Net Profit
$6.85B

2013

2012
$19.12B
$6.11B

Profit Margin Rate

0.2756

0.3195

Operating Profit
Margin Rate
0.2907

0.2972

Financial Health
2013

Net Cash Flow

Working Capital

Current Ratio

Acid-test Ratio

Long-term Debt
Ratio

$8.78B
$14.34B
3.75
3.28

2012
$6.00B
$10.34B
2.95
2.60

0.105

Debt-to-equity Ratio 0.261

0.111
0.282

Financial Performance
2013

Earnings per share

$4.07
Dividend Yield
2.25%

2012

$3.58
2.07%

Should you invest?

Yes!

Growing industry
Strategic market position
Strong financial health and performance

References
Bloomberg. (2014). <<Qualcomms First-Quarter Profit Tops Analyst Estimates>>, [online]
http://www.bloomberg.com/news/2014-01-29/qualcomm-s-first-quarter-profit-exceeds-analysts-estimates.html
EDGAR Online. (2013). <<Qualcomm Inc.DE: Form 10-K (Annual Report)>>, [online]
http://investor.qualcomm.com/annuals-proxies.cfm
EDGAR Online. (2013). <<Qualcomm 2014 Quarterly Reports>>, [online] http://investor.qualcomm.com/annualsproxies.cfm
Handy, Jim. (2013). <<Semiconductors A Crazy Industry>>, [online]
http://www.forbes.com/sites/jimhandy/2014/02/11/semiconductors-a-crazy-industry-2/
Merriam-Webster Dictionary. (2014). <<Dividend>>, [online] http://www.merriam-webster.com/dictionary/dividend
Qualcomm. (2014). <<Company History>>, [online] https://www.qualcomm.com/company/about/history
SEC. (2012). QUALCOMM Incorporated annual report. Washington, D.C: SEC.
Shah, Agam. (2013). <<Intel Loses Ground as Worlds Top Semiconductor Company, Survey Says>>, [online]
http://www.pcworld.com/article/2038645/intel-loses-ground-as-worlds-top-semiconductor-company-survey-says.html
Yahoo! Finance Canada. (2014). <<QCMON Key Statistics>>, [online] https://ca.finance.yahoo.com/q/ks?s=QCOM