Reasonable Price-to-Sales Ratio
Moderate EV/EBITDA Ratio
Good Gross Profit Margin
Strong Liquidity Ratios
🏗️ Strong Market Position
📈 Growth in Defense and Aerospace
🤝 Strategic Partnerships
🚀 Growth Opportunities in HPA and CSG
🔍 Innovation in Automotive Solutions
High Price-to-Earnings Ratio
Low Net Profit Margin
Low Return on Equity
Moderate Debt Levels
📉 Dependence on Android Business
⚠️ Customer Concentration Risk
🔄 Uncertainty in Market Demand
🔒 Increased Competitive Pressures
Qorvo's business quality is supported by a strong market position and growth in defense and aerospace, but faces challenges with reliance on Android revenue and high customer concentration. Future prospects remain positive with growth opportunities in HPA and automotive, though uncertainties in market demand and increased competition pose risks.
Analysis Date: January 28, 2025
Last Updated: March 12, 2025
Trailing Twelve Months (TTM) values provide a view of the company's performance over the last year.
Benjamin Graham's value investing approach focuses on finding stocks with a significant margin of safety between their intrinsic value and market price.
Intrinsic Value
Estimated fair value based on Graham's formula
$11.01
Current Market Price: $55.79
IV/P Ratio: 0.20x (>1.0 indicates undervalued)
Margin of Safety
Gap between intrinsic value and market price
-407.0%
Graham recommended a minimum of 20-30% margin of safety
Higher values indicate a greater potential discount to fair value
Graham Criteria Checklist
Benjamin Graham's value investing checklist for QRVO
Positive earnings (5+ years)
Dividend history (5+ years)
P/E ratio ≤ 20 (197.00)
P/B ratio ≤ 1.5 (1.57)
Current ratio ≥ 2.0 (2.60x)
Long-term debt < Net current assets (1.20x)
Margin of safety (-407.0%)
QRVO does not meet all Graham criteria
Trailing Twelve Months (TTM) values provide a view of the company's performance over the last year.
The gross profit margin of 41.67% shows that the company retains a substantial portion of revenue as profit after accounting for the cost of goods sold.
The net profit margin of only 0.71% indicates that the company is struggling to convert sales into actual profit, which can be a concern for long-term sustainability.
The return on equity (ROE) of 0.78% is significantly low, suggesting that the company is not efficiently generating profits from its equity base.
Profitability metrics measure a company's ability to generate earnings relative to its revenue, operating costs, and other relevant metrics. Higher values generally indicate better performance.
Return on Equity (ROE)
Measures how efficiently a company uses its equity to generate profits
0.78%
Higher values indicate better returns for shareholders
TTM (as of 2025-04-16)
Return on Assets (ROA)
Measures how efficiently a company uses its assets to generate profits
0.69%
Higher values indicate better asset utilization
TTM (as of 2025-04-16)
Gross Profit Margin
Percentage of revenue retained after accounting for cost of goods sold
41.67%
Higher values indicate better efficiency in production
TTM (as of 2025-04-16)
Net Profit Margin
Percentage of revenue retained after accounting for all expenses
0.71%
Higher values indicate better overall profitability
TTM (as of 2025-04-16)
The current ratio of 2.60 and quick ratio of 1.78 indicate that the company has a strong ability to cover its short-term obligations, suggesting good liquidity.
With a debt-to-equity ratio of 0.46 and debt-to-assets ratio of 0.26, the company has manageable debt levels but should be cautious about increasing leverage in a rising interest rate environment.
Financial health metrics assess a company's ability to meet its financial obligations and its overall financial stability.
Debt to Equity Ratio
Total debt divided by total equity
0.46x
Lower values indicate less financial leverage and risk
Less than 1.0 is conservative, 1.0-2.0 is moderate, >2.0 indicates high risk
Q3 2025
Current Ratio
Current assets divided by current liabilities
2.60x
Higher values indicate better short-term liquidity
Less than 1.0 is concerning, 1.0-2.0 is adequate, greater than 2.0 is good
Q3 2025
Qorvo operates in six primary end markets, including automotive, consumer, defense, and aerospace, indicating a diverse market presence. The company is well-positioned to capitalize on global megatrends like electrification, connectivity, and AI, which underpin its product offerings.
The defense and aerospace segment is experiencing strong growth driven by multi-year tailwinds such as upgrades to non-terrestrial networks and advancements in radar systems. Qorvo reported record revenue in this area and expects continued strength.
Qorvo has established strong relationships with key customers, including its largest customer, which accounts for over 50% of revenue. The company is engaged in multiple product programs, indicating strong customer reliance and confidence.
The company anticipates a significant decline in revenue from Android 5G, projected to drop by $150 million to $200 million annually, primarily affecting the ACG segment. This shift poses a risk to overall revenue stability.
As Qorvo's revenue increasingly depends on a few key customers, particularly in the premium smartphone segment, this raises concerns about market vulnerability and competitive pressures.
Qorvo anticipates double-digit growth in the HPA and CSG segments for fiscal year 2026, driven by strong demand for defense technologies and power management solutions, which could offset some declines in ACG.
The company is expanding its portfolio of automotive-grade Ultra-Wideband products, targeting new design wins in the EV sector, indicating potential for significant revenue growth as adoption increases.
The overall market demand remains uncertain, particularly in the automotive and consumer segments, with end-market softness impacting revenue expectations.
With a focus on a smaller number of high-tier customers, the competitive landscape may become more challenging, particularly as competitors also target premium segments.