The Stock To Watch In 2017 - Part I

(RTTNews) - This wireless chipmaker and Apple supplier is well off its 52-week high. Downbeat guidance for the December quarter is not a great help either. Non-GAAP gross margins for the September quarter declined to 42.8% from 48.2% in the previous quarter, and from 49.7% a year ago, well below the company's own expectations of 47%.

The chipmaker cited "lower than expected manufacturing yields during a steep product ramp to a large customer" as the reason for the sharp fall, and acknowledged that it had to work on its gross margin.

"To protect our long-term customer relationships, we did everything we could to assure supply of high-quality material to the customer while working through the internal yield issues [resulting in a great many modules that needed to be scrapped at the finished good level], and this significantly impacted our gross margin," noted president & CEO Bob Bruggeworth, adding that new die-level screens are targeting the issue and working effectively.

Deepening the gloom, the company forecast third-quarter earnings of $1.15 to $1.35 a share, below the $1.45 consensus. Revenue expectations are between $800 million to $840 million, also below the $844.5 million modeled by analysts.

However, we still like the stock in focus -- Qorvo Inc. (QRVO). Let us tell you why. Stay tuned!