Qualcomm (QCOM) Downgraded as Handset Drag Limits Upside, Analyst Says

QUALCOMM Incorporated (NASDAQ:QCOM) is one of the AI Stocks Investors Are Watching Closely. On January 9, Mizuho analyst Vijay Rakesh downgraded the stock from Outperform to Neutral with a price target of $175.00 (from $200.00).

The firm is cautious on the stock despite its robust handset positioning, believing that handset drag limits upside. Qualcomm has been dominant in the mobile chip market for a long time now, recently pushing into artificial intelligence (AI) hardware.

Mizuho has downgraded the stock amid weaker growth expectations, lowering its FY26 and FY27 revenue and earnings forecast to below-consensus levels and introducing FY28 estimates that also trail expectations.

Stock market data on a laptop screen. Photo by Alesia Kozik on Pexels

While the firm notes progress in QCOM’s non-handset business, it believes handset exposure still caps upside.

“Downgrade QCOM to Neutral from Outperform. Lower estimates, PT to $175 from $200. Lower FY26 Rev/EPS from $45.9B/$12.12 to $44.2B/$11.67 (below cons. $45.6B/$12.15). Lower FY27 Rev/EPS from $46.5B/$12.73 to $44.4B/$11.84 (below cons. $46.4B/$12.44). Introduce FY28 Rev/EPS at $45.6B/$12.20 (below cons. $48.8B/$13.02). Our $175 PT is 14.8x FY27 EPS (prior 15.7x), in line with its 14–15x 2–3Y average, which fairly values QCOM below the SOX at ~25x as we see QCOM EPS declining 3% y/y and up 1–3% y/y in FY26–28E. We see QCOM positioned well with non-handset businesses ramping, though with handsets accounting for >70% of QCT revenue, C26E headwinds to the handset industry limit upside.”

QUALCOMM Incorporated (NASDAQ:QCOM) develops wireless technologies, supplies chips for mobile, automotive, and IoT, licenses patents, and invests in emerging tech.

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