Unlock AI Profits: How QCOM Stock Could Be Your Next Big Win

Stocks to buy

Every investor wants to find the next Nvidia (NASDAQ:NVDA). For value-conscious investors, however, Qualcomm (NASDAQ:QCOM) might actually be better than Nvidia in some ways. After all, QCOM stock allows you to participate in the artificial intelligence hardware market’s growth, but without chasing a stock that already went parabolic.

With Qualcomm stock you’ll get a decent dividend and exposure to a consistent earnings winner. So, consider adding a few Qualcomm shares to your portfolio before they explode higher like NVDA stock did.

Go Global in 2024 With QCOM Stock

Truly, Qualcomm’s presence has no boundaries. For example, Qualcomm is on the leading edge of emerging-market innovation with tech-ecosystem development initiatives in Vietnam, Taiwan and Africa.

Qualcomm is partnering with logistics startup Airspace Technologies to expand its operations in Malaysia, Vietnam and Singapore. Qualcomm is collaborating with German telecommunications firm Deutsche Telekom (OTCMKTS:DTEGY) to develop a “futuristic smartphone concept that relies on artificial intelligence rather than applications to handle users’ specific needs.”

The team-up with Deutsche Telekom should remind investors that Qualcomm is, indeed, immersed in the AI-hardware trend. Also on that topic, Qualcomm recently showcased new chips and AI models at a tech expo, the 2024 Mobile World Congress, in Spain.

Sure, Nvidia stock offers AI-technology exposure, but so does Qualcomm stock. In a recent interview, Qualcomm Chief Financial Officer and Chief Operating Officer Akash Palkhiwala strongly emphasized that the company’s chips will be “at the forefront” of AI and large language model deployment.

Qualcomm: An Earnings Winner That’s Not Overvalued

People like to talk about Nvidia’s outstanding earnings results. What about Qualcomm, though? Qualcomm has a terrific track record of beating Wall Street’s quarterly EPS forecasts. Plus, the company’s results for the first quarter of fiscal 2024 beat analysts’ consensus top-line and bottom-line estimates.

While it’s fine to allocate some of your capital toward Nvidia stock, you can also get into the AI-component industry with QCOM stock. Investing in Qualcomm is actually a better deal, in some ways. For example, while Nvidia offers a paltry forward annual dividend yield of 0.02%, Qualcomm’s yearly dividend yield is nearly 2%.

That’s great for passive-income investors, but what about value seekers? Qualcomm has something for just about everyone, as Qualcomm’s GAAP-measured trailing-12-month price-to-earnings (P/E) ratio is 22.51x. For comparison, the sector median P/E ratio is 29.5x, and Nvidia’s P/E ratio is an eyebrow-raising 66.31x.

QCOM Stock: Pair This Up With NVDA Stock

The point here isn’t to pit one stock against another stock. It’s actually not a terrible idea to own equal amounts of Nvidia stock and Qualcomm stock. Both companies are earnings winners in the AI-hardware sector.

Qualcomm is expanding its global footprint and offers an enticing value-and-yield combo. Investors should think about enhancing their NVDA stock holdings with a equal-sized allocation in QCOM stock.

On the date of publication, David Moadel did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

David Moadel has provided compelling content – and crossed the occasional line – on behalf of Motley Fool, Crush the Street, Market Realist, TalkMarkets, TipRanks, Benzinga, and (of course) InvestorPlace.com. He also serves as the chief analyst and market researcher for Portfolio Wealth Global and hosts the popular financial YouTube channel Looking at the Markets.

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