Piper Sandler Initiates Qualcomm at Neutral, $190 PT
Piper Sandler analyst David O’Connor initiates coverage on Qualcomm (NASDAQ: QCOM) with a Neutral rating and a price target of $190.
“QCOM has been late to the Datacenter party, but we are still in the early innings of an AI multi-year growth story and currently the AI market is compute-starved.
Management has put together a compelling set of Hyperscaler design-wins across custom silicon, Accelerators and CPU Server through FY29E, by which stage Handsets will have fallen to ~50% of EBIT.
Datacenter wins will account for ~26% of FY29E revenues and drive a 4- year EPS CAGR of 16%, reaching ~$15 earnings power in FY29E.
Using the company 5- year average P/E multiple of 14x, we value the stock on FY29E and set our PT to $190.
Initiating at Neutral given new design wins are already discounted in share price. To turn more bullish, we would like to see more traction and/or industry acceptance of QCOM’s HBC technology.”
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