QCOM dropped 20% in a month to $171, but 24/7 Wall St. rates it a BUY with a $261 target, citing management's doubled 2029 non-handset revenue goal.
AVGO already books $11 billion per quarter in AI chips, up 143% YoY, which is the rerating QCOM targets if its hyperscaler custom silicon ramp delivers.
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Qualcomm (NASDAQ:QCOM) trades at $170.61 as of the July 16 close, down 20.3% over the past month after a sharp June rally faded. Our 24/7 Wall St. price target for Qualcomm is $260.52, implying 52.7% upside over the next 12 months. The recommendation is buy at a 90% confidence level.
Qualcomm has round-tripped dramatically. Shares hit a 52-week low near $121.54 in March, then rallied to $258.96 high after the June 24 Investor Day, where management doubled its 2029 non-handset revenue target to $40 billion and set a $15 billion AI data center sales goal. That rally has faded, leaving the stock roughly flat year to date at +0.77%.
Fundamentals remain healthy. Q2 FY26 revenue was $10.60 billion and non-GAAP EPS came in at $2.65, meeting expectations on the top line and beating by 3.67% on the bottom.
Automotive hit a record $1.326 billion, up 38% YoY, while handsets fell 13% on memory supply constraints and Chinese OEM channel drawdowns. Polymarket traders assign an 87% probability that Qualcomm beats its next earnings report on July 29.
The bull thesis rests on Qualcomm becoming a credible third player in hyperscaler custom silicon. CEO Cristiano Amon confirmed a custom silicon engagement with a leading hyperscaler is on track for initial shipments in the December quarter.
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Automotive is guided to 50% YoY growth in Q3, exiting FY26 at $6 billion+ run rate. Analyst consensus target sits at $222.73, but our bull-case scenario points to $269.05 if the data center ramp lands cleanly and China handsets bottom on schedule.
The bear case starts with customer concentration. Qualcomm expects only 20% share of Apple phones launching fall 2026, with no relationship beyond that. Handset revenue fell 13% YoY, and Q3 FY26 guidance calls for a step-down to $9.2B-$10B in revenue and $2.10-$2.30 EPS.
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