Qualcomm (NASDAQ:QCOM) Trading Down 6.2% - Should You Sell?

Key Points

• Qualcomm shares fell 6.2% in Wednesday trading, with heavy volume of more than 25.5 million shares, after trading as low as $224.18 and closing at $233.40.
• A major recent catalyst is Qualcomm’s reported custom AI chip deal with ByteDance, which could expand revenue in data centers and strengthen its push into higher-margin AI markets.
• Despite the positive AI news, analysts remain cautious overall: Qualcomm’s consensus rating is still Hold, and there are ongoing concerns about execution and regulatory risks tied to China-related business.

Qualcomm Incorporated (NASDAQ:QCOM - Get Free Report)'s stock price traded down 6.2% during mid-day trading on Wednesday . The company traded as low as $224.18 and last traded at $233.40. 25,519,986 shares traded hands during mid-day trading, an increase of 62% from the average session volume of 15,742,618 shares. The stock had previously closed at $248.82.

Qualcomm News Roundup

Here are the key news stories impacting Qualcomm this week:

• Positive Sentiment: Qualcomm reportedly secured a custom ASIC/AI chip supply deal with ByteDance for AI data centers, a win that could meaningfully expand revenue and validate its push into higher-margin data center markets. Qualcomm strikes AI chip deal with TikTok owner ByteDance, Bloomberg News reports
• Positive Sentiment: Multiple reports said the news sparked a broad rally in Qualcomm shares, with traders betting the company’s AI/data center opportunity is bigger than previously expected and could re-rate the stock versus other semiconductor names. Qualcomm shares jump following report of massive ByteDance AI chip order
• Neutral Sentiment: Commentary pieces highlighted Qualcomm as a trending stock and ran price-prediction discussions, reflecting increased investor attention rather than a new fundamental catalyst. QUALCOMM Incorporated (QCOM) Is a Trending Stock: Facts to Know Before Betting on It
• Negative Sentiment: There is some execution and regulatory risk around the ByteDance opportunity, since export controls and China-related restrictions could affect future deliveries or the size of the revenue opportunity.

Analyst Ratings Changes

A number of analysts have issued reports on the company. Zacks Research raised Qualcomm from a "strong sell" rating to a "hold" rating in a research note on Monday, May 4th. Deutsche Bank Aktiengesellschaft restated a "hold" rating and issued a $160.00 price objective on shares of Qualcomm in a report on Thursday, April 30th. Freedom Capital downgraded Qualcomm from a "strong-buy" rating to a "hold" rating in a report on Wednesday, May 13th. TD Cowen raised their price objective on Qualcomm from $150.00 to $200.00 and gave the stock a "buy" rating in a report on Thursday, April 30th. Finally, JPMorgan Chase & Co. raised their price objective on Qualcomm from $140.00 to $160.00 and gave the stock a "neutral" rating in a report on Thursday, April 30th. 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 company's stock. According to data from MarketBeat.com, the company has a consensus rating of "Hold" and a consensus target price of $181.79.

Qualcomm Trading Down 6.2%

The firm has a market capitalization of $246.00 billion, a PE ratio of 25.37, a P/E/G ratio of 29.50 and a beta of 1.49. 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 firm has a fifty day moving average of $159.34 and a 200 day moving average of $159.68.

Qualcomm (NASDAQ:QCOM - Get Free Report) last posted its quarterly earnings data 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. Qualcomm had a return on equity of 42.11% and a net margin of 22.31%.The company had revenue of $10.60 billion for the quarter, compared to the consensus estimate of $10.59 billion. During the same period in the previous year, the business earned $2.85 EPS. Qualcomm's revenue for the quarter was down 3.5% compared to the same quarter last year. Qualcomm has set its Q3 2026 guidance at 2.100-2.300 EPS. Equities research analysts expect that Qualcomm Incorporated will post 7.99 EPS for the current year.

Qualcomm Increases Dividend

The company also recently announced a quarterly dividend, which will be paid on Thursday, June 25th. Stockholders of record on Thursday, June 4th will be given a $0.92 dividend. This represents a $3.68 annualized dividend and a dividend yield of 1.6%. The ex-dividend date is Thursday, June 4th. This is a positive change from Qualcomm's previous quarterly dividend of $0.89. Qualcomm's payout ratio is 38.70%.

Qualcomm declared that its Board of Directors has approved a stock repurchase program on Tuesday, March 17th that permits the company to repurchase $20.00 billion in shares. This repurchase authorization permits the wireless technology company to buy up to 14.5% of its stock through open market purchases. Stock repurchase programs are often an indication that the company's management believes its shares are undervalued.

Insider Transactions at Qualcomm

In other news, CAO Patricia Y. Grech sold 829 shares of Qualcomm stock in a transaction that occurred on Thursday, May 21st. The stock was sold at an average price of $201.77, for a total value of $167,267.33. The sale was disclosed in a document filed with the Securities & Exchange Commission, which is available at 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 the business's stock in a transaction that occurred on Monday, April 13th. The shares were sold at an average price of $130.34, for a total value of $325,850.00. Following the transaction, the executive vice president owned 30,684 shares of the company's stock, valued at $3,999,352.56. This represents a 7.53% 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 19,306 shares of company stock worth $3,435,583 in the last quarter. Insiders own 0.05% of the company's stock.

Institutional Inflows and Outflows

A number of hedge funds and other institutional investors have recently added to or reduced their stakes in the stock. Axiom Investment Management LLC acquired a new position in Qualcomm during the 1st quarter valued at approximately $65,000. WNY Asset Management LLC acquired a new position in Qualcomm during the 1st quarter valued at approximately $279,000. Wellington Grp LLC boosted its position in Qualcomm by 100.5% during the 1st quarter. Wellington Grp LLC now owns 417 shares of the wireless technology company's stock valued at $54,000 after purchasing an additional 209 shares during the period. Vestor Capital LLC boosted its position in Qualcomm by 259.6% during the 1st quarter. Vestor Capital LLC now owns 597 shares of the wireless technology company's stock valued at $77,000 after purchasing an additional 431 shares during the period. Finally, Groupe la Francaise boosted its position in Qualcomm by 8.0% during the 1st quarter. Groupe la Francaise now owns 34,456 shares of the wireless technology company's stock valued at $4,437,000 after purchasing an additional 2,553 shares during the period. Institutional investors and hedge funds own 74.35% of the company's stock.

About Qualcomm

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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