Shares of innovative RF solutions provider Qorvo, Inc. (QRVO) have declined about 19.4% so far this year. Recently, QRVO delivered a better-than-estimated performance for the third quarter on both its top-line and bottom-line fronts.
Driven by growth across 5G, IoT connectivity, defense, and power, revenue increased 1.75% year-over-year to $1.11 billion, outperforming estimates by $8.1 million. Earnings per share at $2.98 came in ahead of expectations by $0.22.
Further, on February 7, Qorvo Biotechnologies, a subsidiary of QRVO, bagged a $4.1 million follow-on contract from NIH for the SARS-CoV-2/ Flu combo and antigen pooling. The company had earlier bagged a $24.4 million contract from the NIH. The development enables QRVO to accelerate the production and launch of multiple testing solutions for COVID-19 by making use of a single platform.
With these developments in mind, let us take a look at the changes in QRVO’s key risk factors that investors should know.
Risk Factors
According to the TipRanks Risk Factors tool, Qorvo’s top risk category is Finance & Corporate, contributing 7 of the total 32 risks identified for the stock, compared to the sector average of 16 risk factors under the same category.
In its recent report, the company has changed one key risk factor under the Production risk category.
QRVO highlighted that it purchases a number of component parts, substrates, and silicon-based products from external suppliers. The company also depends on third-party suppliers for different services.
This exposes QRVO to third-party risks including lack of control over delivery schedules, capacity constraints, cost increases, and supply chain disruptions.
Consequently, any delays in product launches or supply shortages could lower the company’s revenue or impact its customer relationships.
Hedge Fund Activity
According to TipRanks data, the Wall Street’s top hedge funds have decreased holdings in Qorvo by 267 thousand shares in the last quarter, indicating a very negative hedge fund confidence signal in the stock based on activities of 8 hedge funds.
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