Monday, April 11, 2011

Apple (AAPL) (NOK) (RIMM) and Qualcomm's (QCOM) New Contracts

Nokia (NYSE:NOK), Research in Motion (NASDAQ:RIMM), and Apple (NASDAQ:AAPL) are about to enter into new contracts with Qualcomm (NASDAQ:QCOM), according to MKM Partners analyst Tero Kuittinen, who raised his rating on the company from "Neutral" to "Buy."

Consequently, Kuittinen now believes Qualcomm will ship about 486 million units of its “mobile station modem,” up from a previous estimate of 483 million units shipped, at an average price of $16.73 a unit, up from $16.29 previously. He estimates $3.15 a share in profit this fiscal year, up from $2.84 previously.


Kuittinen said on Nokia, “We believe Nokia is moving all of its Windows phone design to the San Diego center. In our view, this augurs the use of Qualcomm baseband and processor chips in all first-wave (i.e., Windows 7 Phone OS) Nokia phones.”

Concerning RIM he said they will, “execute a broad and rapid geographic expansion of the new Bold and Touch launches this summer in North America, Europe and Middle East [with] launches of the more advanced models using Qualcomm chips.”

For Apple, the, “iPhone is naturally likely to be a top seller in the autumn; we also anticipate iPad sales to hit at least 40mn units in CY11. We believe Qualcomm does not have baseband in all iPads, and tablet sales in general are beginning to slant increasingly toward WiFi-only devices, so the tablet upside is not as clear as the handset momentum, in our view.”

Qualcomm closed Friday at $53.63, gaining $0.40, or 0.75 percent. Kuittinen has a price target of $63 on them.

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