Mobile World Congress Is Coming, Investors

The Mobile World Congress in Barcelona is the year's first big event in the mobile space, and many manufacturers take the event's high profile as an opportunity to announce flagship devices. QUALCOMM, Inc. QCOM, Samsung, LG, and HTC made big announcements last year and are expected to do the same at this year's event between February 22 and 25.

Poor Investor Reaction Last Year

Last year, Qualcomm teased its Snapdragon 820 smartphone chip, a powerful 64-bit processor that enabled smartphones to use more secure fingerprint identification technology. Now, Samsung and LG plan to use the chip in their new mainline devices. Last year, Qualcomm saw a price dip during the conference, potentially due to investor reluctance after the poor performance of Qualcomm's previous chip. The Snapdragon 810's poor heat management caused several types of smartphone to overheat, slowing them down.

The company's price today is only slightly more than half of its value at the previous conference, from $70.03 at the end of last year's Congress to $48.26 at press time.
Samsung announced the Galaxy S6 at 2015's Congress, but investors didn't seem to budge, producing no notable price action.
The conference started a small rout last year for LG that saw its price fall from $15.10 to $13.55, which might have represented investors' collective eye-roll at the company's Urbane smartwatch announcement. The stock began a general decline that cost it nearly half its value, sitting at $9.08 Wednesday afternoon.
HTC lost $6 in share value during last year's conference, bringing it to $143.

Looking Ahead To 2016

The takeaway from our analysis is that most smartphone manufacturers can't rely on a snazzy product announcement to hide poor numbers or overlook technical issues. The financial fundamentals of the company and quality of the products matter more to investors than the company's ability to create Main Street hype.
Qualcomm was up 3 percent and LG and Samsung up about 1.5 percent Wednesday afternoon, with investors potentially looking ahead to the conference. HTC shares were down a little over 2 percent at press time.