Morgan Stanley upgraded Qualcomm to ‘Equal Weight’ from ‘Underweight’, while hiking the price target by 58% to $231 from $146.
- Morgan Stanley analyst Joseph Moore said Qualcomm’s projection for $5 billion in AI data center sales by fiscal 2027 firmly places the chipmaker among AI beneficiaries.
- Rosenblatt raised its price target on Qualcomm to $265 from $190 and reiterated its ‘Buy’ rating, calling the company’s investor day a “definitive turning point.”
- The firm said Qualcomm has finally moved beyond the Apple-related headwinds that have long weighed on its valuation.
Shares of Qualcomm Inc. (QCOM) soared nearly 10% in Thursday’s opening trade before paring some of the early gains following the company’s Investor Day on Wednesday, which prompted Wall Street to embrace its AI data center pivot.
According to TheFly, Morgan Stanley upgraded Qualcomm to ‘Equal Weight’ from ‘Underweight’, while hiking the price target by 58% to $231 from $146.
Wall Street Turns Bullish On QCOM
Morgan Stanley analyst Joseph Moore acknowledged that the firm had “been wrong to be skeptical.”
Moore said Qualcomm’s projection for $5 billion in AI data center sales by fiscal 2027 firmly places the chipmaker among AI beneficiaries, though he cautioned the three-year growth ramp remains a “show-me story.”
Rosenblatt raised its price target on Qualcomm to $265 from $190 and reiterated its ‘Buy’ rating, calling the company’s investor day a “definitive turning point.”
The firm said Qualcomm has finally moved beyond the Apple-related headwinds that have long weighed on its valuation, with updated financial targets that exceeded consensus expectations, led by stronger data center growth.
Bernstein raised its price target on Qualcomm to $235 from $140 while maintaining a ‘Market Perform’ rating. The firm said the company’s investor day reinforced its diversification strategy, with stronger-than-expected data center and automotive revenue targets.
However, Bernstein cautioned that a softer smartphone outlook could weigh on near-term earnings until data center growth becomes more meaningful.
BofA increased its price target on Qualcomm to $220 from $195 but reiterated its ‘Underperform’ rating. While the firm praised Qualcomm’s stronger long-term revenue and earnings targets unveiled at investor day, it said the stock already prices in meaningful data center success and warned that key growth initiatives still need to be proven.
What QCOM Announced At Its Investor Day
Qualcomm announced partnerships with Meta Platforms Inc. (META) and Microsoft Corp. (MSFT) at its investor day on Wednesday.
The company entered into a multi-generation agreement to supply Meta with its Dragonfly C1000 data center CPUs, which will power its next-generation server fleet. The chipmaker said production is expected to begin in the second half of 2028, with the CPUs designed to deliver high performance while improving power efficiency and lowering data center operating costs.
Qualcomm also said that Microsoft will use its High Bandwidth Compute chip architecture for its Azure infrastructure, instead of the pricier chips used by Nvidia and others.
The company also released revenue guidance for fiscal year 2029. It expects automotive revenue of $10 billion, Internet of Things (IoT) revenue of more than $14 billion, and data center revenue of over $15 billion. Qualcomm had previously guided for $8 billion in automotive revenue and $14 billion in IoT revenue in its 2024 investor day update. The company did not provide guidance on revenue from the data center at its 2024 investor day.
Qualcomm also announced on Wednesday that it would acquire AI startup Modular, with CEO Cristiano Amon terming it a “pivotal moment” for the industry.
What Retail Traders Think Of QCOM Stock
Retail sentiment on Stocktwits around Qualcomm trended in the ‘bullish’ territory, with message volumes at ‘high’ levels at the time of writing.
QCOM stock is up 21% year-to-date and 33% over the past 12 months. The S&P 500 ETF (SPY) is up 21% over the past 12 months, while the Invesco QQQ Trust ETF (QQQ) is up 31%.
The Vanguard S&P 500 ETF (VOO) and the iShares Core S&P 500 ETF (IVV) are up 21% during this period.
For updates and corrections, email newsroom[at]stocktwits[dot]com.<