Mizuho Downgrades Qualcomm to Neutral

Mizuho analyst Vijay Rakesh downgraded Qualcomm (NASDAQ: QCOM) from Outperform to Neutral with a price target of $175.00 (from $200.00).

“Downgrade QCOM to Neutral from Outperform, Lower Estimates, PT to $175 from $200 Lower F26E Rev/EPS from $45.9B/$12.12 to $44.2B/$11.67 (BELOW cons. $45.6B/$12.15) Lower F27E Rev/EPS from $46.5B/$12.73 to $44.4B/$11.84 (BELOW cons. $46.4B/$12.44) Introduce F28E Rev/EPS at $45.6B/$12.20 (BELOW cons. $48.8B/$13.02) Our $175PT is 14.8x our F27E EPS (prior 15.7x) inline with its 14-15x 2-3Y average, with fairly valued below the SOX at ~25x as we see QCOM EPS declining 3% y/y and up 1-3% y/y in F26-28E.

We see QCOM positioned well with non-handset businesses ramping, though with Handsets accounting for >70% of QCT revs, C26E headwinds to the handset industry limits upside.”

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