QRVO - Qorvo: Not My Cup Of Tea During Smartphone Downturn - Initiating With A Sell

2024-03-12 03:50:24 ET

Summary

• Qorvo, a wireless connectivity semi-player, announced the third quarter of FY24 results earlier this quarter, and I’m unconvinced of management’s growth story.
• I think the company is much too exposed to the smartphone market to be able to outperform given the current smartphone weakness.
• Qorvo makes around 79% of all its money from its advanced cellular group, which was flat sequentially this quarter.
• Apple's declining sales in China and the overall slowdown in the Chinese market are red flags for Qorvo's performance.
• I share my thoughts on Qorvo here and why I think it'll underperform expectations over the coming quarter.

Investment Thesis

Earlier this quarter, Qorvo ( QRVO ) reported results for the third quarter of FY24 and its outlook for next quarter; I'm unconvinced of Qorvo's growth story for 4Q24 and 1HFY25 due to smartphone weakness. I recommend investors take advantage of the stock's current price to explore exit points or trim their exposure....

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