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UPDATE: Morgan Stanley Reiterates QUALCOMM at Overweight; Guidance Likely Conservative

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Morgan Stanley reiterated its Buy rating and $73 price target on QUALCOMM (NASDAQ: QCOM) as it believes chipset margins should expand in fiscal 2013.

Morgan Stanley noted, "[W]e continue to believe that the QCOM FY13 guide is conservative as the mosaic of information QCOM gave on its earnings call last week implies that chipset gross margin decline 200-250 bps y/y in FY13. On the contrary, we believe chipset gross margin should expand as 1) FY12 COGS was impacted by the tape-outs at multiple foundries to mitigate the 28nm shortage; and 2) the mix of LTE chips (which likely grows to ~40% of all chipments in FY13 from just ~5% in FY12) is a tailwind. Indeed, we believe chipset gross margin increased ~90 bps q/q in FQ4 as 28nm shipments started in earnest."

QUALCOMM closed at $61.62 on Friday.

Posted-In: Morgan Stanley rAnalyst Color Reiteration Intraday Update Analyst Ratings

 

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