Better Buy: Sierra Wireless vs. Qualcomm

Better Buy: Sierra Wireless vs. Qualcomm

Investors looking for plays on the Internet of Things may have their eyes on both Qualcomm (NASDAQ: QCOM) and Sierra Wireless (NASDAQ: SWIR). Sierra makes chips and cloud-based software that connect things like industrial equipment and vehicles to the Internet. The company is small, with a market cap of just $675 million, but it has built a leadership position in the machine-to-machine (M2M) and IoT markets.

Meanwhile, tech juggernaut Qualcomm has a market cap of $77 billion,  sells mobile processors and baseband processors (for connecting devices to cellular networks) and has made a killing from licensing its patents to other tech companies. Additionally, it's in the middle of purchasing NXP Semiconductors (NASDAQ: NXPI), which makes chips for all sorts of Internet-connected devices, including cars. All of which means that Qualcomm and Sierra may soon have overlapping IoT pursuits.

So which stock is the better buy right now? Let's take a look at each company's financial strength, competitive advantages, and valuation in order find out.

Continue reading

Source: Fool.com