Will diversification effort aid networking equipment maker Qualcomm to top consensus mark in Q2?
Qualcomm (NASDAQ:QCOM) is scheduled to announce FQ2 earnings results on Wednesday, April 27th, after market close.
The consensus EPS Estimate is $2.92 (+53.7% Y/Y) and the consensus Revenue Estimate is $10.6B (+33.5% Y/Y) driven by the ramp-up in 5G-enabled chips and strength in its Snapdragon portfolio.
The company is expected to report lower licensing revenues owing to the strained Sino-U.S. bilateral trade relations and Ukraine-Russia war.
Over the last 2 years, QCOM has beaten EPS estimates 100% of the time and has beaten revenue estimates 88% of the time.
Over the last 3 months, EPS estimates have seen 21 upward revisions and 1 downward. Revenue estimates have seen 18 upward revisions and 0 downward.
Looking back, the company estimated to generate between $10.2B and $11B in revenue, with EPS coming in between $2.80 and $3 on the back of its diversification efforts to move beyond handset chips and stronger supply chain management. The company exceeded the consensus mark in Q1.
During the quarter, the company announced dividend hike of 10%.

Rating

Several Analysts lowered the price target of semiconductor stocks, citing multiple headwinds, including weak 5G demand, mobile phone and PC unit growth forecast to slow or decline.
QCOM shares dipped early Tuesday as investment firm Rosenblatt noted that semiconductor stocks exposed to the 5G cellular market have seen sharp downturns in recent trading, but the sell-off is "overdone."
On Monday, Qualcomm (QCOM) and a number of other semiconductor companies saw their price targets cut at Morgan Stanley, ahead of earnings season, with the firm noting strength in analog and [semiconductor capital equipment] markets and weakness in vertical markets. Morgan Stanley lowered the price target to $167 from $223 and maintains overweight rating.
Deutsche Bank analyst Ross Seymore cut the target on QCOM to $190 from $210 and maintains buy rating.
Stock has underperform broader market index since the start of 2022: