Please ensure Javascript is enabled for purposes of website accessibility

America's 5th Best CEO Will Give You an Investing Edge

By Brian Stoffel - Apr 5, 2013 at 5:00PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

With an eye towards the mobile revolution, it helps to have an engineer at the helm.

Once you get the hang of it, it's pretty easy to dissect balance sheets, income, and cash flow statements. This is the first step in getting your feet wet in the investment world.

But it doesn't stop there. If we were to base investing decisions solely on what we read in these statements, that would be akin to picking a significant other based solely on their Facebook profile -- to many, it just doesn't make sense to avoid real-life interaction.

Investigating these "soft" aspects of a company is important for investors. And although we can't capture all of the intangibles of a company in one article, -- a website that collects employee sentiment for companies across the world -- recently came out with a list that could help: the Top CEOs of 2013.

Over the past few days, I've covered CEOs 25 through 6. Today, I'm going to introduce you to the company with the 5th-highest-rated CEO, give you some background on the company, and at the end, I'll offer access to a special free report on who is going to win the war between the five biggest tech stocks.

Qualcomm (QCOM 2.87%)
For those who might be unfamiliar with Qualcomm's business, it's a two-headed beast that's been performing exceptionally well.

On one hand, 60% of the company's revenue comes from its wireless chips business. That means that it designs and manufactures chips for uses around the world. On the other hand, the company's portfolio of patents and licensing accounts for 85% of net income before taxes.

While continued revenue from the licensees and patents will require further investment in research and development, the company's chips are well positioned. As Fool colleague Evan Niu recently pointed out, although the company gets a lot of press for providing baseband chips for Apple (AAPL 1.67%), it won't meet its death if Apple's upcoming earnings fail to impress, as many are expecting them to.

That's because Samsung's Galaxy S4 units, expected to come out this month, use both baseband and processor chips -- giving investors twice the exposure to the smartphone company that presents the greatest challenge to Apple today.

But the real reason to get excited about the company is its prospects moving forward. Many of the company's patents cover 3G technologies that make mobile access to the Internet possible. With 1 billion smartphone users worldwide, you'd think that the company had already tapped out its potential markets. But nothing could be further from the truth, as smartphones make up only 17% of all mobile subscribers.


Leadership to match the opportunity
At the center of this opportunity from the transition to mobile Internet usage is Qualcomm CEO Dr. Paul E. Jacobs. Jacobs has served as CEO of the company since March of 2009, but his tenure at the company is much longer.

In 1990, Jacobs joined the staff at Qualcomm as an engineer working on cell phone digital signal processors. His background and experience means that Jacobs is not only a manager, but a leader who is gifted with intimate knowledge of how Qualcomm's technology works, and how it is differentiated from the competition.

Clearly, that kind of knowledge alone makes Jacobs valuable. But the fact that his employees give him a 95% approval rating goes beyond that. A quick look through employee reviews shows they almost universally praise the culture that's been cultivated at the company, with a sense of teamwork, camaraderie, and innovation mentioned almost uniformly.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

QUALCOMM Incorporated Stock Quote
QUALCOMM Incorporated
$135.00 (2.87%) $3.77
Apple Inc. Stock Quote
Apple Inc.
$142.86 (1.67%) $2.34
Meta Platforms, Inc. Stock Quote
Meta Platforms, Inc.
$188.59 (2.59%) $4.76

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning service.

Stock Advisor Returns
S&P 500 Returns

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 05/26/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.