Qualcomm could post weak revenue results when the maker of mobile processors and 5G wireless chipsets reports earnings after the market close Wednesday.
That’s because global smartphone demand has been deteriorating. Last week, research firm Canalys said first-quarter worldwide shipments for mobile phones fell 13% year over year due to difficult economic conditions.
As a larger supplier for the smartphone market, it might be difficult for Qualcomm (ticker: QCOM) to post strong results.
The Wall Street consensus estimates for
Qualcomm
‘s fiscal second quarter, ended in March, are revenue of $9.1 billion with adjusted earnings per share of $2.15. Analysts’ estimates for the current quarter are earnings $2.17 a share and revenue of $9.1 billion.
On Monday, Bernstein analyst Stacy Rasgon reiterated his Outperform rating on Qualcomm shares, citing their low valuation. He also lowered his price target for the stock to $145 from $155. The stock closed Tuesday at $116.11.
“Smartphones remain very weak,” Rasgon wrote. The “stock should become more buyable once we (hopefully soon?) reach the smartphone bottom. And in the meantime the shares are not trading like investors are expecting tailwinds anyway.”
Qualcomm shares have declined about 20% over the past 12 months, compared with the roughly flat performance for the
iShares Semiconductor ETF
(SOXX), which tracks the ICE Semiconductor Index.
Write to Tae Kim at tae.kim@barrons.com
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