Qualcomm (NASDAQ:QCOM) Shares Down 8% - Here's What Happened

Key Points

• Qualcomm shares fell 8% on Tuesday, with trading volume running well above average, as the stock pulled back from a recent strong run. The move appears tied to broader tech-sector selling and profit-taking.
• Investor attention remains on Qualcomm’s AI and data center strategy, including reports that it is in advanced talks to acquire AI chip startup Modular. Some analysts view the company as an undervalued AI play, but others want proof the strategy can compete in a crowded market.
• Wall Street sentiment is mixed: the stock has a consensus Hold rating and a consensus price target of $191.90, even as Qualcomm beat quarterly EPS expectations and raised its dividend to $0.92 per share. The company also has a $20 billion buyback authorization in place.

Qualcomm Incorporated (NASDAQ:QCOM - Get Free Report) shares dropped 8% on Tuesday . The company traded as low as $198.44 and last traded at $204.13. 23,629,508 shares traded hands during mid-day trading, an increase of 43% from the average daily volume of 16,523,873 shares. The stock had previously closed at $221.90.

Key Stories Impacting Qualcomm

Here are the key news stories impacting Qualcomm this week:

• Positive Sentiment: Reports that Qualcomm is in advanced talks to buy Modular could strengthen its AI and data center strategy and support longer-term growth. Reuters: Qualcomm nearing deal for AI chip startup Modular
• Positive Sentiment: Some investors see Qualcomm as an undervalued AI play, citing its low-power chip expertise and potential to grow in edge AI and inference. Trefis: Qualcomm's AI Pivot: Smarter Than It Looks
• Neutral Sentiment: Qualcomm’s AI ambitions are drawing bullish commentary, with some analysts calling it a value AI stock as the company expands beyond mobile chips. Yahoo Finance: Jim Cramer Discusses Qualcomm (QCOM) As A Value AI Play
• Neutral Sentiment: Qualcomm’s upcoming Investor Day is a key catalyst, but investors are waiting for management to prove its AI/data center roadmap can compete in a crowded market. Benzinga: Qualcomm AI, Data Center Opportunity Fails To Win Over Analyst
• Negative Sentiment: A broader technology selloff and profit-taking after a strong run are pressuring the shares, even as the AI story develops. Invezz: Qualcomm eyes modular AI deal as stock falls on tech selloff pressure
• Negative Sentiment: Bank of America’s underperform rating and cautious valuation stance suggest some analysts think upside may be limited from here. Benzinga: Qualcomm price target update

Wall Street Analyst Weigh In

A number of analysts have commented on the company. Cantor Fitzgerald boosted their price objective on Qualcomm from $150.00 to $200.00 and gave the stock a "neutral" rating in a report on Monday. Citigroup upped their price target on Qualcomm from $140.00 to $160.00 and gave the stock a "neutral" rating in a report on Thursday, April 30th. Barclays increased their price target on Qualcomm from $130.00 to $150.00 and gave the company an "underweight" rating in a research report on Thursday, April 30th. Weiss Ratings restated a "hold (c)" rating on shares of Qualcomm in a research note on Friday, March 27th. Finally, Daiwa Securities Group raised shares of Qualcomm from a "neutral" rating to an "outperform" rating and set a $225.00 price objective on the stock in a report on Friday, May 8th. Fifteen analysts have rated the stock with a Buy rating, sixteen have issued a Hold rating and three have given a Sell rating to the company's stock. According to data from MarketBeat.com, the company has a consensus rating of "Hold" and a consensus price target of $191.90.

Qualcomm Stock Down 8.0%

The stock has a 50 day moving average price of $195.70 and a 200 day moving average price of $167.12. The company has a debt-to-equity ratio of 0.54, a quick ratio of 1.61 and a current ratio of 2.37. The company has a market capitalization of $215.15 billion, a P/E ratio of 22.19, a PEG ratio of 28.09 and a beta of 1.59.

Qualcomm (NASDAQ:QCOM - Get Free Report) last posted its quarterly earnings results on Wednesday, April 29th. The wireless technology company reported $2.65 earnings per share for the quarter, beating the consensus estimate of $2.56 by $0.09. The company had revenue of $10.60 billion during the quarter, compared to analyst estimates of $10.59 billion. Qualcomm had a net margin of 22.31% and a return on equity of 42.11%. The firm's revenue for the quarter was down 3.5% on a year-over-year basis. During the same quarter in the prior year, the business earned $2.85 earnings per share. Qualcomm has set its Q3 2026 guidance at 2.100-2.300 EPS. Equities research analysts forecast that Qualcomm Incorporated will post 7.97 earnings per share for the current fiscal year.

Qualcomm Increases Dividend

The company also recently announced a quarterly dividend, which will be paid on Thursday, June 25th. Shareholders of record on Thursday, June 4th will be given a $0.92 dividend. This is an increase from Qualcomm's previous quarterly dividend of $0.89. This represents a $3.68 dividend on an annualized basis and a yield of 1.8%. The ex-dividend date of this dividend is Thursday, June 4th. Qualcomm's dividend payout ratio (DPR) is 40.00%.

Qualcomm announced that its Board of Directors has initiated a stock buyback plan on Tuesday, March 17th that permits the company to repurchase $20.00 billion in outstanding shares. This repurchase authorization permits the wireless technology company to purchase up to 14.5% of its stock through open market purchases. Stock repurchase plans are usually an indication that the company's board of directors believes its stock is undervalued.

Insider Transactions at Qualcomm

In related news, EVP Heather S. Ace sold 3,200 shares of the business's stock in a transaction dated Monday, May 4th. The stock was sold at an average price of $177.82, for a total value of $569,024.00. Following the sale, the executive vice president directly owned 39,735 shares in the company, valued at approximately $7,065,677.70. The trade was a 7.45% decrease in their position. The sale was disclosed in a legal filing with the SEC, which is accessible through this hyperlink. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, CEO Cristiano R. Amon sold 10,000 shares of the stock in a transaction dated Monday, May 4th. The stock was sold at an average price of $180.00, for a total transaction of $1,800,000.00. Following the transaction, the chief executive officer owned 197,568 shares of the company's stock, valued at $35,562,240. This represents a 4.82% decrease in their position. The SEC filing for this sale provides additional information. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders have sold a total of 21,806 shares of company stock worth $3,928,958 over the last 90 days. 0.05% of the stock is owned by insiders.

Institutional Investors Weigh In On Qualcomm

Institutional investors and hedge funds have recently modified their holdings of the company. Richardson Financial Services Inc. raised its position in shares of Qualcomm by 90.9% in the fourth quarter. Richardson Financial Services Inc. now owns 168 shares of the wireless technology company's stock worth $29,000 after buying an additional 80 shares in the last quarter. Torren Management LLC bought a new position in Qualcomm in the 4th quarter worth about $29,000. Caitong International Asset Management Co. Ltd raised its holdings in shares of Qualcomm by 17,000.0% in the 4th quarter. Caitong International Asset Management Co. Ltd now owns 171 shares of the wireless technology company's stock valued at $29,000 after acquiring an additional 170 shares in the last quarter. Birchwood Financial Partners Inc. bought a new stake in shares of Qualcomm during the 4th quarter valued at about $31,000. Finally, Commonwealth Retirement Investments LLC bought a new position in shares of Qualcomm in the fourth quarter worth approximately $32,000. 74.35% of the stock is owned by hedge funds and other institutional investors.

Qualcomm Company Profile

Qualcomm Incorporated is a global semiconductor and telecommunications equipment company headquartered in San Diego, California. Founded in 1985, the company is known for its development of wireless technologies and for playing a central role in the evolution of digital cellular standards, including CDMA and subsequent generations of mobile standards. Qualcomm’s business combines the design and sale of semiconductor products with a patent licensing program for wireless technologies and related intellectual property.

The company’s product portfolio includes system-on-chip (SoC) platforms marketed under the Snapdragon brand, cellular modem and RF front-end components, connectivity solutions for Wi‑Fi and Bluetooth, and processors and platforms aimed at automotive, IoT, networking and edge-computing applications.

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