For a chip company like Qorvo (NASDAQ:QRVO), there's an ongoing need to pair attractive revenue growth with strong margins as both loom large in chip stock valuation. Recently Qorvo has done well shoring up the prospects for the first half, as content wins with Apple (NASDAQ:AAPL) and ongoing share growth with Chinese handset makers are making a good case for mobile revenue growth. What's more, wireless infrastructure seems to be rebounding nicely off a recent bottom.
But Qorvo still doesn't have all of its ducks in a row. Gross margin has disappointed recently and management's guidance was not particularly encouraging - dredging up past margin concerns and limited the enthusiasm over share-driven revenue growth. Healthy margins can justify a fair value in the $60s today, but I don't consider management execution to be a given here like I do with Broadcom (NASDAQ:AVGO), and there are risks that rivals like Skyworks (NASDAQ:SWKS) and Qualcomm (NASDAQ:QCOM) will ultimately squeeze a little harder in the future.
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Qorvo Still A Few Ducks Short Of A Nice Row