Qualcomm Rallies Off Q2 Earnings: Takeaways From 4 Analysts

Qualcomm, Inc. QCOM reported second-quarter revenue of $11.16 billion Wednesday, a whopping 41% expansion driven by Android phone chip sales.

The company posted earnings of $3.21 per share, up 69% year-over-year, crushing Street expectations.

KeyBanc Capital Markets On Qualcomm: Analyst John Vinh maintained an Overweight rating on Qualcomm with a $200 price target. 

“F2Q QCT revenue of $9.55B (+8% q/q, +52% y/y) was above our estimate of $9.05B, with handsets, auto, and IoT above our estimates,” Vinh wrote in a note. QTL revenue reflected “a modest decline in lower-tier units, offset by a favorable mix,” he added.

“Despite slowing China smartphone demand, QCOM sees QCT Handset rev growth of over 50% in FY22.”  

Rosenblatt Securities On Qualcomm: Analyst Kevin Cassidy reiterated a Buy rating on Qualcomm while reducing the price target from $225 to $220.

“Qualcomm's results confounded the market view that the semiconductor cycle has rolled over based on weakening handset and PC demand. What is becoming clear is that the need for increasing processing power is driving this semiconductor cycle,” Cassidy wrote in a note.

Wells Fargo On Qualcomm: Analyst Gary Mobley maintained an Equal Weight rating on Qualcomm while reducing the price target from $185 to $150.

Qualcomm’s handset business performed better than expected due to share gains at Samsung, Mobley said.

“While the quarter was impressive, we continue to believe QCOM may be seeing the most optimal of conditions,” the analyst wrote. He added that investors “overall will assign lower multiples to chip companies serving the no-growth mobile handset market.”

Raymond James On Qualcomm: Analyst Chris Caso reiterated a Strong Buy rating and $222 price target. 

“Qualcomm silenced the critics with a strong report and guidance despite chatter regarding China handset weakness during the quarter,” Caso said in the note.

“The company also guided to over 50% y/y growth in their handset business in FY22, which coupled with June guidance, implies strong sequential growth in September, which we believe will be driven by new high-end Android launches.”

QCOM Price Action: Qualcomm shares were trading 7.22% higher at $144.85 midday Thursday, according to Benzinga Pro.