QRVO - Qorvo: Anchored To A Lacking Smartphone Market - Sell

2024-05-30 00:46:30 ET

Summary

• Qorvo's stock underperforms the S&P 500 by around 20% since my last sell article on the company in March.
• In my opinion, the company's reliance on smartphone demand, particularly from Apple, poses a downside risk given the weak smartphone demand environment.
• Qorvo's management expects sales to decline further next quarter, indicating a lack of near-term catalysts for growth.
• I think Qorvo will continue to struggle to grow its top-line in the near-term, specifically over the next 1-2 quarters.
• I share my thoughts on Qorvo here and why I think it has limited upside for 2024.

Investment Thesis

It’s been almost a month since Qorvo ( QRVO ) reported its fourth quarter of FY2024 results and outlook; since my sell-rating on Qorvo in mid-March, the stock underperforms the S&P 500 by around 20%, as shown below. I'm updating my investment thesis post-earning results to reiterate my sell. I think a lot of the bad news has already been factored into the stock price performance and management’s outlook for the June quarter, but I see more downside risk over the next quarter....

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