Why QCOM is a solid pick for passive investors
Qualcomm, Inc. (NASDAQ:QCOM) is down 1.1% to trade at $169.09 this afternoon. The semiconductor concern has struggled with a ceiling at the $176 level over the last couple of weeks, while the 120-day moving average is still acting as an area of support. Earlier this year, the equity hit a Jan. 5, record high of $193.58, which has contributed to its 25.2% year-over-year lead.
The brokerage bunch is bullish towards the security. Of the 18 analysts in coverage, 11 call QCOM a "buy" or better. Plus, the 12-month consensus target price of $219.63 is a 29.1% premium to current levels.
At the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), Qualcomm stock sports a 10-day put/call ratio of 0.47 that sits higher than 81% of readings from the last year. So, while calls outnumbered puts on an overall basis, the latter are getting picked up at a quicker-than-usual clip.
QCOM has generated strong top- and bottom-line growth over multiple years. The chipmaker has increased its trailing 12-month revenues 7% since 2021, and 59% since 2018. Qualcomm's trailing 12-month net income has also added 10% since 2021. Plus, the firm is expected to grow its earnings by 6.2% and revenues by 7.6% in the current fiscal year.
Qualcomm stock’s valuation is very intriguing, given it is trading at a forward price-earnings ratio of 14.73, and a price-sales ratio of 5.43, despite a massive market cap of $192.6 billion. The equity also offers a forward dividend of $2.72, with a dividend yield of 1.59%, making it a great option for passive investors looking for consistent long-term growth.