Qualcomm
Soros Fund Management has held a Qualcomm, Inc. (NASDAQ:QCOM) position of various sizes over the past few years, presently holding about 605,000 shares, down from a little over 1 million shares in 2010. As we noted previously, Qualcomm is very well positioned to profit from the worldwide conversion to 3G wireless technology in developing economies and to 4G in the United States and Europe. Qualcomm also collects royalties on about 40 percent of Apple’s (NASDAQ:AAPL) iPhone sales. As the tablet revolution continues, and as mobile phones become more heavily commoditized, a company with the production efficiency of Qualcomm stands to have considerable advantage as a supplier of mobile electronics components.
Exar Corp
Exar Corporation (NASDAQ:EXAR) produces a variety of semiconductor solutions for telecommunication, industrial, storage, and network applications. Though earnings are projected to be in the red for year ending March 2012, the consensus earnings estimate for the year ending March 2013 is about $0.20 per share, which is expected to increase to $0.40 per share in 2014. Though the company’s sales have recently been sluggish, it has a very strong balance sheet with practically no debt as a percentage of equity. The company has recently restructured its mission, reducing its total headcount by 40 percent and eliminating $22 million in gross annual spending within a period of 90 days. The company derived 53 percent of its revenue in fiscal year 2012 from connectivity solutions and another 22 percent from power management solutions. The company intends to exploit its thirty years of experience in mixed-signal and analogue electronics solutions in order to increase its market share in these areas. Soros’ position in the stock has steadily increased in the past few years and presently sits at about 6.6 million shares.
Macy’s
To round off the tech recommendations with a retail holding, Macy’s, Inc. (NYSE:M) has also been a mainstay in Soros’ portfolio. The company’s shares are trading at some of their highest levels in over five years .The stock is sensitive to the broader market (beta=1.6), though it has handsomely outperformed the S&P over the past decade and every time frame I examined (2-year, 5-year, 10-year, and 15-year). Unlike J.C. Penney Company, Inc. (NYSE:JCP), Macy’s, Inc., which also operates the Bloomingdale’s, has seen its brand name steadily appreciate in its history and, in particularly, over the past decade. The company’s shares are trading at 12 times 2012 consensus earnings, which is below that of Nordstrom, Inc. (NYSE:JWN) and Saks Inc (NYSE:SKS), which are trading at 18 times and 22 times, respectively.
