More than six months have passed since my last write-up on Qorvo (QRVO), and this remains a frustrating stock. The shares have modestly underperformed the S&P 500, outperformed the NASDAQ, more or less kept pace with the SOX, and outperformed other well-known chip companies with meaningful smartphone front-end exposure (like Broadcom (AVGO), Qualcomm (QCOM), and Skyworks (SWKS), but I still find the performance to be less than the fundamentals should merit.
I get that there is less bullishness about smartphones now than in past cycles, but I think that overlooks the content and unit growth leverage that Qorvo has, as this company has been gaining share outside the Apple (AAPL) ecosystem. I also understand some of the short-term frustrations with the Infrastructure business, but I think the long-term outlook remains attractive. All in all, I see the potential for double-digit annualized total returns from here, and it looks attractively priced in a sector that doesn't have many of those opportunities.
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