The stock market is in a downtrend, and that will likely continue until the Federal Reserve stops its current policy of raising interest rates. This downtrend is throwing out great companies along with weaker ones, and has hit the tech space fairly hard.
That’s creating one of the best buying opportunities for investors in tech in years. That’s especially true with companies that can still deliver on growth in a slowing economy.
Case in point is wireless semiconductor chip company Qualcomm (QCOM). The ongoing rollout of the 5G network and the ongoing need to upgrade phones makes the company a steady growth play in uncertain times.
At current prices, about 10 times forward earnings, even analysts see the stock as too cheap.
Action to take: Shares are still slightly down over the past year, but shares are coming off their lows. The company has a solid valuation here and a 28 percent profit margin. Today’s buyers can also nab a 2.2 percent dividend yield at current prices, with room for future growth.
For traders, the January 2023 $165 calls, last going for about $9.35, offer a mid-double-digit return potential in the coming months. Traders should continue to buy on down days for a stock, and look to take some profits off the table quickly in today’s volatile environment.
Disclosure: The author of this article has a position in the company mentioned here, and may further trade after the next 72 hours. The author receives no compensation from any of the companies mentioned in this article.