QUALCOMM, Inc. (NASDAQ:QCOM) Stock Could Offer More Than 20% Upside Potentials

QUALCOMM, Inc. (NASDAQ:QCOM) Stock Could Offer More Than 20% Upside Potentials

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QUALCOMM, Inc. (NASDAQ:QCOM) shares are trading down in the pre-market trading on Thursday. Following the fourth quarter results, S&P Capital IQ analyst Zino reduced his price target on the chip maker’s shares by $10 from $80 to $70. This implied that the stock has the upside potentials of over 20 percent from the current levels.

Though legal issues with Apple Inc. (NASDAQ:AAPL) remained a big concern, Zino thinks that pricing drop to moderate. “We see the pending NXP Semiconductor (NXP 98***) deal providing significant earnings leverage and revenue opportunities,” he told his clients in his research note.

The analyst’s price objective is based on a near peer PE of 14.7X his fiscal year 2018 EPS estimate. Zino pointed out that the company reported earnings of $1.19 a share for the December quarter that topped Capital IQ consensus by a penny. Sales grew 4.1 percent driven by positive trends in China, as well as, superior device sales.

Following the results, Zino adjusted his EPS estimate from $4.75 to $4.59 for the fiscal year ending September 2017. For the fiscal year 2018, he reduced his EPS expectations from $4.93 to $4.76.

At time of writing this, Qualcomm shares traded down 3.69 percent in the pre-market trading.