Qualcomm (NASDAQ:QCOM) Shares Gap Down - Should You Sell?

Key Points

• Qualcomm shares gapped down sharply, opening at $233.33 after a prior close of $251.02 and last trading around $230.67, a drop of about 6.9%.
• Analyst sentiment is mixed: several firms recently updated ratings, but the overall consensus remains Hold with a target price of $181.79, while some analysts still rate the stock Buy and one downgraded it to Underweight.
• Qualcomm reported solid quarterly results and raised its dividend to $0.92 per share from $0.89, while also maintaining a $20 billion share repurchase authorization.

Shares of Qualcomm Incorporated (NASDAQ:QCOM - Get Free Report) gapped down before the market opened on Monday . The stock had previously closed at $251.02, but opened at $233.33. Qualcomm shares last traded at $230.6680, with a volume of 5,483,232 shares traded.

Wall Street Analyst Weigh In

Several brokerages recently issued reports on QCOM. Roth Mkm began coverage on shares of Qualcomm in a research note on Friday, May 8th. They set a "buy" rating on the stock. Wells Fargo & Company lowered shares of Qualcomm from a "positive" rating to an "underweight" rating in a report on Friday, May 8th. Rosenblatt Securities reissued a "buy" rating and set a $190.00 price objective on shares of Qualcomm in a research report on Thursday, April 30th. Susquehanna raised their target price on Qualcomm from $140.00 to $160.00 and gave the company a "neutral" rating in a research note on Thursday, April 30th. Finally, Daiwa Securities Group raised Qualcomm from a "neutral" rating to an "outperform" rating and set a $225.00 target price for the company in a research report on Friday, May 8th. Fourteen equities research analysts have rated the stock with a Buy rating, sixteen have given a Hold rating and four have issued a Sell rating to the stock. According to data from MarketBeat, Qualcomm has a consensus rating of "Hold" and a consensus target price of $181.79.

Qualcomm Trading Down 6.9%

The company has a quick ratio of 1.61, a current ratio of 2.37 and a debt-to-equity ratio of 0.54. The firm has a 50 day moving average price of $166.07 and a 200 day moving average price of $161.17. The stock has a market capitalization of $246.29 billion, a PE ratio of 25.39, a P/E/G ratio of 31.09 and a beta of 1.59.

Qualcomm (NASDAQ:QCOM - Get Free Report) last posted its earnings results on Wednesday, April 29th. The wireless technology company reported $2.65 earnings per share (EPS) for the quarter, topping the consensus estimate of $2.56 by $0.09. The firm 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 business's revenue was down 3.5% compared to the same quarter last year. During the same quarter in the prior year, the business posted $2.85 EPS. Qualcomm has set its Q3 2026 guidance at 2.100-2.300 EPS. Equities analysts expect that Qualcomm Incorporated will post 7.99 EPS for the current fiscal year.

Qualcomm Increases Dividend

The business also recently disclosed a quarterly dividend, which will be paid on Thursday, June 25th. Investors of record on Thursday, June 4th will be issued a dividend of $0.92 per share. This represents a $3.68 dividend on an annualized basis and a yield of 1.6%. This is a boost from Qualcomm's previous quarterly dividend of $0.89. The ex-dividend date is Thursday, June 4th. Qualcomm's dividend payout ratio is 38.70%.

Qualcomm announced that its board has approved a share repurchase program on Tuesday, March 17th that authorizes the company to repurchase $20.00 billion in outstanding shares. This repurchase authorization authorizes the wireless technology company to buy up to 14.5% of its shares through open market purchases. Shares repurchase programs are often a sign that the company's management believes its stock is undervalued.

Insider Transactions at Qualcomm

In other news, CAO Patricia Y. Grech sold 829 shares of the stock in a transaction on Thursday, May 21st. The stock was sold at an average price of $201.77, for a total transaction of $167,267.33. The transaction was disclosed in a filing with the Securities & Exchange Commission, which is accessible through this hyperlink. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, EVP Akash J. Palkhiwala sold 2,500 shares of Qualcomm stock in a transaction dated Monday, April 13th. The stock was sold at an average price of $130.34, for a total value of $325,850.00. Following the completion of the sale, the executive vice president directly owned 30,684 shares of the company's stock, valued at approximately $3,999,352.56. This trade represents a 7.53% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders sold a total of 19,306 shares of company stock valued at $3,435,583 in the last three months. 0.05% of the stock is currently owned by company insiders.

Hedge Funds Weigh In On Qualcomm

Institutional investors and hedge funds have recently added to or reduced their stakes in the business. Your Advocates Ltd. LLP bought a new position in Qualcomm in the 1st quarter worth approximately $26,000. Richardson Financial Services Inc. lifted its position in shares of Qualcomm by 90.9% during the fourth quarter. Richardson Financial Services Inc. now owns 168 shares of the wireless technology company's stock worth $29,000 after acquiring an additional 80 shares in the last quarter. Torren Management LLC purchased a new stake in shares of Qualcomm during the fourth quarter worth $29,000. Caitong International Asset Management Co. Ltd boosted its holdings in shares of Qualcomm by 17,000.0% in the fourth quarter. Caitong International Asset Management Co. Ltd now owns 171 shares of the wireless technology company's stock worth $29,000 after acquiring an additional 170 shares during the period. Finally, Birchwood Financial Partners Inc. purchased a new position in shares of Qualcomm in the fourth quarter valued at $31,000. Institutional investors own 74.35% of the company's stock.

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.

This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to contact@marketbeat.com.