Bernstein Research’s Stacy Rasgon this morning reiterates an Outperform rating on shares of Qualcomm (QCOM) and a $75 price target, writing that the company’s forecast for this quarter, its fiscal Q2 ending in March, is achievable because of the upside provided by Apple’s (AAPL) iPhone.
Qualcomm’s forecast for the current quarter,�offered back on February 1st, called for total industry sales of 3G and 4G handsets of $47.5 billion to $51.5 billion.
That estimate, however, really pertains to what Qualcomm believes was sold last quarter, as Qualcomm recognizes royalties one month in arrears.
And so Rasgon reviews data from research firm Strategy Analytics that showed a jump in 3G and 4G sales in the December quarter, but also a pronounced “AAPL effect” as he calls it:
Data from Strategy Analytics indicates that overall 3G/4G handset shipments (CDMA, WCDMA, TD-SCDMA, and LTE) rose by 24.9% in CQ411 (Exhibit 1), well above typical seasonality of ~15% unit growth – 3G handset shipment performance varied by OEMs, but most vendors saw units increase. By far the standout was AAPL, with iPhone shipments up an astonishing 116% sequentially. Research in Motion (RIMM), Nokia (NOK), and “Other” vendors all saw unit increases in excess of 20%; Motorola Mobility (MMI)�and Samsung Electronics (005930KS)�also had strong performance (up 15.4% and 16.3%, respectively). Sharp’s shipments were flattish QoQ. Unit shipment laggards included LG Electronics (06657011KS)�(down 12.9%) and HTC (2498TW) (down 22.7%). We note that 3G handset shipments excluding the iPhone were up ~15%, seasonal in their own right; thus it appears QCOM is benefitting not only from AAPL’s strength (and, conceivably, share gains) but also general strength in the market as the 3G/4G cycle continues to strengthen.
Qualcomm shares today are down 22 cents at $62.56.
Fin.
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