Pacific Crest Believes QCOM Still Has Room to Grow

By Ryan Adsit

In a report released yesterday, Michael McConnell from Pacific Crest reiterated a Buy rating on Qualcomm Inc (NASDAQ: QCOM), with a price target of $83. The company’s shares opened today at $67.69, close to its 52-week high of $71.62.

McConnell wrote:

“We remain buyers because of: (1) significant EPS accretion and end-market diversification away from mobile from the pending NXP acquisition, and (2) an attractive dividend yield of 3.2%.”

According to TipRanks.com, McConnell is a 4-star analyst with an average return of 7.8% and a 63.3% success rate. McConnell covers the Technology sector, focusing on stocks such as Advanced Micro Devices, Silicon Laboratories, and Skyworks Solutions.

Currently, the analyst consensus on Qualcomm Inc is Moderate Buy and the average price target is $72.73, representing a 7.4% upside.

In a report issued on October 31, Nomura Holdings also upgraded the stock to Buy with a $80 price target.

Based on Qualcomm Inc’s latest earnings report from March 31, the company posted quarterly revenue of $5.55B and quarterly net profit of $1.16B. In comparison, last year the company earned revenue of $5.46B and had a net profit of $1.06B.

Based on the recent corporate insider activity of 86 insiders, corporate insider sentiment is positive on the stock. This means that over the past quarter there has been an increase of insiders buying their shares of QCOM in relation to earlier this year. Most recently, in March 2016, Donald Cruickshank, a Director at QCOM sold 18,000 shares for a total of $922,680.

QUALCOMM, Inc. engages in the development, design, manufacture, and marketing of digital telecommunications products and services. It operates through three segments: Qualcomm CDMA Technologies, Qualcomm Technology Licensing, and Qualcomm Strategic Initiatives. The Qualcomm CDMA Technologies segment develops and supplies integrated circuits and system software based on technologies for the use in voice and data communications, networking, application processing, multimedia, and global positioning system products. The Qualcomm Technology Licensing segment provides rights to use portions of the firm’s intellectual property portfolio. The Qualcomm Strategic Initiatives segment invests in the technology, design, and introduction of products and services for voice and data communications. The company was founded by Franklin Antonio, Adelia Coffman, Andrew Cohen, Klein Gilhousen, Irwin Mark Jacobs, Andrew Viterbi, and Harvey White in July 1985 and is headquartered in San Diego, CA.