Aaron Rakers, an analyst from Wells Fargo, maintained the Sell rating on Qualcomm. The associated price target remains the same with $140.00.
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Aaron Rakers has given his Sell rating due to a combination of factors impacting Qualcomm’s business outlook. One of the primary concerns is the ongoing risk in the handset segment, particularly with the anticipated loss of business from Apple and uncertainties around demand, which could be influenced by tariff issues and local subsidies in China. Although Qualcomm is making strides in diversifying its business, especially in the Internet of Things (IoT) and datacenter opportunities, these efforts are expected to take time to materialize fully.
Moreover, while Qualcomm has reported some positive developments, such as IoT outperforming expectations, the overall handset revenue growth has been weaker than anticipated. The company’s guidance for the upcoming quarter suggests modest growth, but the potential impact of losing Apple as a customer remains a significant concern. Additionally, while there are promising advancements in the datacenter sector, these are still in the early stages, and substantial revenue contributions are not expected until the future. These factors collectively contribute to the cautious outlook and the Sell rating.