Overview
Bernstein SocGen Group has reduced its 12-month price target for Qualcomm (NASDAQ: QCOM) to $200.00 from $215.00, while keeping an Outperform rating on the stock. At the time of the firm’s note Qualcomm was trading at $151.59, which means the revised target still points to material upside from current levels. Bernstein’s view aligns closely with an external Fair Value assessment from InvestingPro that also suggests the shares are undervalued.
Reasons for the reduction
The research house cited several market dynamics behind the lower target. Broader investor aversion to the smartphone segment, concerns over an Apple-related revenue rolloff, and recent shifts in the memory market all informed the decision. Bernstein noted that Qualcomm shares have underperformed significantly in recent months, and InvestingPro indicators show the stock’s relative strength index (RSI) in oversold territory. Year-to-date performance stands at -11.38% according to InvestingPro data.
Balance of risks and durability
Despite the target cut, Bernstein emphasized that Qualcomm may be somewhat insulated from the worst smartphone market pressures because the company is over-weighted toward the higher-end phone segment. That said, the firm was explicit that insulation does not equal immunity to broader industry headwinds.
Bernstein pointed to several company-level strengths that support its constructive stance. Qualcomm reported 13.66% revenue growth over the past twelve months, carries an overall financial health score labeled as "GOOD," and produces significant cash flow. The firm highlighted $12.8 billion in levered free cash flow, which implies roughly an 8% free cash flow yield on the current figures cited.
Product and strategic positioning
The note described Qualcomm’s product portfolio as "objectively strong" and said an adjacency story - notably an emerging AI narrative - is "looking increasingly real." Bernstein expects this AI-related trajectory to become more visible over time as portions of Apple-related revenue decline.
Valuation was another focal point. Bernstein flagged that Qualcomm is trading at less than 13 times forward earnings and characterized that multiple as approximately a 44% discount to the S&P 500 and a 56% discount to the Philadelphia Semiconductor Index (SOX). The firm suggested these discounts point to potential value despite the company operating in parts of the market that are currently out of favor.
Corporate actions and technology initiatives
Qualcomm announced it will continue its quarterly cash dividend at $0.89 per common share, payable to stockholders on March 26, 2026, maintaining its existing dividend policy. The company is also in discussions with Samsung Electronics about the potential contract manufacturing of advanced two-nanometer chips. Qualcomm CEO Cristiano Amon confirmed that design work for these chips is complete and that the products could be near commercialization.
On the product front, Qualcomm unveiled the Dragonwing IQ10 Series robotics architecture and processor at CES. The new processor is positioned to improve capabilities in industrial autonomous mobile robots and humanoid robots, reflecting the firm’s push into industrial and robotics-adjacent markets.
Market context and other analyst views
Alongside Bernstein’s note, RBC Capital initiated coverage on Qualcomm with a Sector Perform rating, citing slower smartphone growth and Apple’s in-sourcing of modems as headwinds. These differing analyst perspectives underscore the mix of structural opportunities and cyclical pressures facing Qualcomm.
Conclusion
Bernstein’s cut of the price target reflects near-term market concerns tied to smartphones and memory dynamics, but the firm retains an Outperform stance based on Qualcomm’s product strength, cash generation and potential AI-led adjacencies. The company’s dividend decision, chip-design progress and robotics-oriented processor launch further illustrate ongoing strategic initiatives as investors weigh valuation discounts against sector uncertainties.
Data points cited
- New Bernstein price target: $200.00 (previously $215.00)
- Qualcomm trading price cited: $151.59
- InvestingPro year-to-date return: -11.38%
- Revenue growth over last twelve months: 13.66%
- Levered free cash flow: $12.8 billion (reported)
- Implied free cash flow yield: 8%
- Dividend per share: $0.89, payable March 26, 2026
- Valuation: less than 13x forward earnings; ~44% discount to S&P 500 and ~56% discount to SOX