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Upgrade lifts Qualcomm shares

Qualcomm managed to buck Monday's sell-off, picking up 1 7/8 to 68 1/8 after First Union Securities upgraded the wireless telecommunications company from a "buy" recommendation to a "strong buy."

Qualcomm (Nasdaq: QCOM) shares have stagnated for most of the year after its spectacular performance throughout 1999.

In its latest quarter, Qualcomm met analysts' estimates when it posted a profit of $218 million, or 27 cents a share, on sales of $714 million.

On Monday, First Union Securities analyst Mark Roberts set a 12-month price target of $90 a share.

"We think investors should begin aggressively buying the shares because we suspect that there are several good news events ahead for the shares and relatively few potential negative surprises," Roberts wrote in a research note.

He also said the company's relatively flat earnings in recent quarters can be mainly attributed to weakness in Korea, a key market for its third generation CDMA cellular technology.

The $714 million in sales it recorded in the third quarter marked an 11 percent improvement from the year-ago quarter when it earned $155.7 million, or 22 cents a share, on sales of $645 million.

First Call Corp. consensus predicts the San Diego, Calif. company will earn 24 cents a share in its fourth quarter and $1.29 a share in fiscal 2001.

Its shares moved up to a 52-week high of $200 a share shortly after its 4-for-1 stock split in December. Last September, the stock slumped to a low of 45 1/8.

Eighteen of the 22 analysts covering the stock rate it either a "buy" or "strong buy."

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