The Street is Bullish on Qualcomm's Mega-Buyback

announced that it would repurchase $15 billion in shares as part of a 2013 plan to reduce shares outstanding by 5-10 percent. Over the next 12 months, the company will complete $10 billion of these repurchases. Qualcomm also increased its dividend to $1.92, a 14 percent increase. As a result, shares are trading nearly 2 percent higher.

Of four firms who released notes this morning, Morgan Stanley is the only firm without a buy rating on Qualcomm. Morgan Stanley analysts believe that the share reduction is built into the current price.

Analysts at three other firms – Canaccord Genuity, BMO Capital Markets and Credit Suisse – are more bullish on the buyback. Canaccord called it a "material increase in capital return program," while Credit Suisse said it was a "notable cash return." The analysts don't necessarily disagree with Morgan Stanley that some share repurchases were expected, but seem to differ in the size of the expected buyback. Canaccord increased its price target to $87, noting that the shares are still "undervalued" at present.

BMO Capital Markets has Qualcomm as a member of its "Top 15 US Large Cap Stocks." Analysts at BMO raised the price target by $3 to $85, keeping the valuation constant at 15x 2016 EPS estimates.