On January 9, Mizuho analyst Vijay Rakesh downgraded Qualcomm Incorporated (NASDAQ: QCOM) stock from Outperform to Neutral. The price target was reduced to $175.00 from $200.00.
The firm expressed caution regarding the stock's potential upside, citing limitations from its handset business. Qualcomm has long been a dominant player in the mobile chip market and has recently expanded into artificial intelligence hardware.
Mizuho revised its growth expectations downward, lowering its revenue and earnings per share forecasts for fiscal years 2026 and 2027 to levels below consensus. The firm also introduced estimates for fiscal year 2028 that trail market expectations.
While acknowledging progress in Qualcomm's non-handset segments, Mizuho believes the company's significant exposure to the handset market continues to cap its growth potential.
Vijay Rakesh stated in the analyst note: "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 develops wireless technologies and supplies semiconductor chips for mobile devices, automotive systems, and the Internet of Things. The company also holds a significant patent portfolio for licensing.