Analysts Bump Up Qualcomm Price Target Post Q4 Beat

  • Analysts bumped up their price targets on Qualcomm Inc QCOM following the Q4 beat and strong Q1 FY22 outlook.
  • Morgan Stanley analyst Joseph Moore raised the PT to $187 from $180, implying a 21% upside, and reiterated an Overweight. 
  • While he had "high confidence" in Qualcomm numbers, Moore was "still surprised at the magnitude of upside," as the company beat his revenue and earnings estimates by 5% and 15% and guided to 20% earnings growth in FY22 that was about 15% higher than his estimate.
  • Wells Fargo analyst Gary Mobley raised the PT to $150 from $138, implying a 2% downside, and maintained an Equal Weight. 
  • The analyst cites better-than-expected Q4 results and Q1 2022 guide. 
  • While Qualcomm is executing well, much like any other semiconductor company in the current environment, and despite good execution concerning growing RFFE, IoT & automotive sales above market growth rates, Mobley is reluctant to chase the stock with a rating upgrade because Qualcomm may be seeing the most optimal of conditions.
  • KeyBanc analyst John Vinh raised the PT to $185 from $175, implying a 20% upside, and affirmed an Overweight. 
  • Qualcomm's efforts to address supply constraints and diversify away from handsets are starting to pay dividends for the company as it is benefiting from share gains in mobile, driving beat-and-raise results, with Q2 also expected to be better than seasonal due to the ramp of new SnapDragon platforms and non-handset growth, the analyst contends. 
  • As such, Qualcomm sees more significant than 20% EPS growth in the fiscal year 2022, Vinh adds.
  • Citi analyst Christopher Danely raised the PT to $165 from $158 and reiterated a Neutral. 
  • However, the analyst still expects share loss and pressure on royalty rates as the 5G cycle matures further in 2022.
  • Goldman Sachs analyst Rod Hall upgraded to Buy from Neutral with a PT of $194, up from $162, implying a 26% upside. 
  • The company last night reported a "strong beat and raise quarter" and indicated above 20% earnings growth in fiscal 2022. 
  • The analyst says the earnings growth indication was double his 10% forecast as Qualcomm called out expected better high-end Android momentum and broader based positive expectations in other business lines. 
  • He believes that a higher-end Android phone based on Snapdragon represents $60 of content plus royalties for Qualcomm versus just $30 for an iPhone. 
  • Hall cites Android momentum for the upgrade of Qualcomm.
  • Piper Sandler analyst Harsh Kumar raised the PT to $190 from $175 and affirmed an Overweight. 
  • The analyst is making Qualcomm his top large-cap pick due to its "exceptional positioning and strength in the Android market." 
  • The company is "extremely well-positioned," both near and long term, and the Android handset strength will help offset any risk from Apple Inc AAPL moving away.
  • Price Action: QCOM shares traded higher by 11.9% at $154.92 on the last check Thursday.
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