Qualcomm stock holds steady as Cantor Fitzgerald maintains neutral stance

Investing.com - Qualcomm (NASDAQ:QCOM), the $164.5 billion semiconductor giant with a solid financial health score according to InvestingPro, received a reiterated Neutral rating and $150 price target from Cantor Fitzgerald following the chipmaker’s quarterly earnings report. The stock currently trades at an attractive 16.1x earnings multiple, with analysis suggesting it may be undervalued.

The semiconductor company posted revenues of $10.4 billion and earnings per share of $2.77, slightly exceeding consensus estimates of $10.3 billion and $2.71. Management raised guidance for the September quarter to $10.7 billion in revenue and $2.85 in earnings per share, ahead of analyst expectations. The company maintains impressive revenue growth of 16.2% and a robust gross profit margin of 55.7%.

Cantor Fitzgerald noted that despite industry concerns about tariff-related pull-ins, Qualcomm management reported no such activity, with handset upside in the upcoming quarter attributed exclusively to a new product launch. The firm highlighted Qualcomm’s strong positioning in XR/AR markets, with Meta (NASDAQ:META)’s smart glasses exceeding expectations and new Snapdragon-powered devices expected from Xiaomi (OTC:XIACF).

The research firm pointed to automotive revenues as another bright spot, with approximately $1 billion expected in the September quarter, putting Qualcomm on track to meet its fiscal 2026 target of $4 billion in automotive revenue.

Despite these positives, Cantor Fitzgerald expressed concern about QCT segment margins of 28% in the September quarter, which it identified as a disappointment that could worsen as Apple (NASDAQ:AAPL) is fully removed from Qualcomm’s business model. The firm indicated this margin pressure was likely responsible for after-hours weakness in the stock. For deeper insights into Qualcomm’s valuation and comprehensive financial analysis, access the detailed Pro Research Report available exclusively on InvestingPro, covering over 1,400 top US stocks.

In other recent news, Qualcomm reported its fiscal third-quarter 2025 earnings, exceeding analyst expectations with an earnings per share (EPS) of $2.77, compared to the forecasted $2.71. The company’s revenue for this period reached $10.37 billion, slightly above the anticipated $10.33 billion. Qualcomm also provided guidance for the September quarter, projecting revenue of $10.7 billion, which aligns with expectations. However, there are modest concerns regarding Qualcomm CDMA Technologies (QCT) margins. Mizuho (NYSE:MFG) has adjusted its price target for Qualcomm to $185 from $190, while maintaining an Outperform rating. These developments highlight Qualcomm’s recent financial performance and market assessments.

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