As we head into the final week of June, Qualcomm Inc. (NASDAQ: QCOM) continues to test investors’ patience. Even with a fundamentally solid earnings report in April and a tidy 25% gains since then, the tech giant is failing to ignite the kind of sustained uptrend seen in bigger peers like NVIDIA Corp (NASDAQ: NVDA) or Broadcom Inc (NASDAQ: AVGO). Shares have been drifting downwards for nearly two weeks, though Monday’s 1% gain showed some welcome strength. The uptrend that began in April is technically still intact, but only just.
This lack of momentum has been especially frustrating given Qualcomm’s healthy diversification across handsets, automotive, and the Internet of Things (IoT), not to mention its recent M&A activity.
And yet, analyst coverage has been sparse in comparison to other major chipmakers. That’s why last week’s update from Bank of America can't be ignored.
Bank of America Sees at Least 30% Upside
Bank of America’s research team, led by Tal Liani, reiterated its Buy rating on Qualcomm, though it trimmed its price target from $245 to $200. It’s a noteworthy move, while they’ve tempered expectations, they still see roughly 30% upside from where the stock closed on Monday.
Their reasoning was clear. As we mentioned above, Qualcomm’s Q2 earnings were solid, with the numbers coming in ahead of analyst expectations pretty much across the board. Its QCT segment, which includes the company’s core chip business, and its Handsets did especially well, while Automotive and IOT were both impressive too.
Potential Headwinds for Qualcomm
The problem, though, according to Bank of America, is that some of its sales trends are showing signs of stagnation. As Apple Inc. (NASDAQ: AAPL), one of Qualcomm’s key customers, continues to bring more and more of its manufacturing in-house, Bank of America now expects its contribution to headset sales to fall sharply and potentially disappear altogether. That’s a huge headwind for a company still heavily dependent on smartphone cycles.
Still, they believe Qualcomm’s AI PCs and data center growth can offset some of the drag, though the company is lacking any near-term catalysts that could spark renewed bullishness. All that being said, however, their updated $200 target reflects a 15x multiple on their 2026 earnings estimate, which keeps Qualcomm looking extremely cheap relative to the sector. The stock’s current forward P/E sits below 14, in stark contrast to NVIDIA’s 46.
These risks aren't new, but taken together, they help explain why the stock has struggled to build lasting momentum. The Bank of America team could easily have downgraded the stock to a Hold, but they didn’t, and investors should take confidence from that.
And with the stock trading at a highly unusual discount to its peers from a valuation standpoint, you can’t help but feel there’s a bargain to be had here - you might just have to wait a little longer than is ideal for the payoff.
Watch the Chart
From a technical standpoint, Qualcomm is approaching an inflection point. Last week’s update would have helped spur some bullish interest, but the stock has been effectively trending down for the past fortnight. Crucially, the MACD just completed a bearish crossover, and momentum could turn negative if shares don’t start rallying north soon.
Given the S&P 500 index is on the verge of an all-time record close, bulls will want to see Qualcomm move back towards $160 this week, which would mean it avoids setting a lower low and risking a breakdown of the uptrend.
For investors willing to stomach some near-term volatility, Qualcomm offers an intriguing mix of value, optionality, and a long-term AI tailwind. The latest analyst commentary should serve as a reminder that while the potential mightn’t be as bright as some others out there, it’s far from lost. But unless shares can shake off the lethargy and recapture momentum soon, it may take another upside surprise to get the stock firing again.
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