Nomura Cuts Qualcomm 3 Months After Upgrade

Expressing concern regarding the timeline of the NXP Semiconductors NV NXPI deal, Nomura’s Romit Shah downgraded the rating on QUALCOMM, Inc. QCOM from Buy to Neutral, while lowering the price target from $80 to $70.

Deal Concerns

Shah mentioned that the NXP Semiconductors deal was expected to boost Qualcomm’s 2018 EPS by 30 percent, an accretion that would be “too significant for investors to ignore.”

At the time Qualcomm had announced the deal, the company’s licensing practices in Asia, Europe and the United States were “known risks,” the analyst stated, and were likely to have been factored into the timeline for the closure of the deal in late 2017.

The EPS estimates for the company for FY 2016 and FY 2017 are $4.17 and $4.57, respectively.

At last check in Monday's pre-market session, shares of Qualcomm were down 4.42 percent at $60.10.