Why Bernstein Still Sees Value in Qualcomm (QCOM) Despite Smartphone Fears

QUALCOMM Incorporated (NASDAQ:QCOM) is 1 of the 10 AI Stocks Analysts Are Watching. On February 2, Bernstein SocGen Group expert Stacy Rasgon lowered the terms people connected the banal to $200.00 (from $215.00) portion maintaining an “Outperform” rating. Despite definite risks, the steadfast is constructively affirmative connected the banal driven by a processing undervalued maturation narrative.

Bernstein noted however the QCOM shares person lagged successful caller months owed to factors specified arsenic a wide distaste of smartphones, AAPL rotation off, and caller dynamics successful the representation market. While the request for smartphones has been fine, investors stay cautious astir the guardant outlook.

Despite these concerns, the steadfast believes QCOM whitethorn beryllium much insulated owed to its over-indexing to the higher-end segment, adjacent though it is not needfully immune to broader manufacture headwinds.

The steadfast further added that arsenic Apple-related revenues diminish implicit time, QCOM’s beardown merchandise portfolio, increasing adjacencies, and an emerging AI communicative volition let the company’s underlying spot to go much visible.

QCOM’s existent valuation is astatine little than 13x guardant earnings, representing an estimated 44% discount to the S&P 500 and a 56% discount to the Philadelphia Semiconductor Index (SOX). This implies imaginable worth contempt concerns astir the institution operating successful out-of-favor marketplace segments.

“We get that the banal plays successful out-of-favor areas, numbers mightiness beryllium excessively high, etc. But we inactive deliberation the communicative is worthy a look arsenic the communicative grows cleaner done the year. We little our PT to $200 to bespeak little estimates, but support our Outperform rating.”

QUALCOMM Incorporated (NASDAQ:QCOM) develops wireless technologies, supplies chips for mobile, automotive, and IoT, licenses patents, and invests successful emerging tech.

While we admit the imaginable of QCOM arsenic an investment, we judge definite AI stocks connection greater upside imaginable and transportation little downside risk. If you’re looking for an highly undervalued AI banal that besides stands to payment importantly from Trump-era tariffs and the onshoring trend, spot our escaped study connected the best short-term AI stock.

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Disclosure: None. This nonfiction is primitively published at Insider Monkey.