On June 28, the shares of chipmaker Qualcomm Incorporated (NASDAQ: QCOM) increased to $131.6. The statement, which allayed investor concerns about a potential end to Apple’s supply, was the primary factor.
According to Ming-Chi Kuo, a well-known authority on Apple electronics and technological advancements, Qualcomm Incorporated (QCOM) will continue to be the exclusive provider of wireless modems for Apple iPhones introduced in 2023.
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As Apple creates its own modem for the iPhone 5G, the same expert had predicted that Qualcomm’s portion of those deliveries would be no higher than 20 percent. Ming-Chi Kuo evidently believes that Apple won’t be able to give up Qualcomm Incorporated (QCOM) modems in the upcoming year.
The analyst believes that Apple’s attempt to create its own 5G modem appears to have failed. In light of this, Qualcomm’s revenue in 2023 and 2024 may surpass projections.
The complexity of 5G RF chips, which are on the cusp of contemporary technical potential for semiconductor downsizing, should be recognized. Apple will find it difficult to replace Qualcomm’s products, but Ming-Chi Kuo predicts the business will keep creating its own modem.
According to Tristan Gerra, a financial analyst at Baird, Qualcomm Incorporated (QCOM)’s earnings might increase from $1.8 to $2 in 2023, surpassing a previous projection of $13.75. If Qualcomm continues to be the only vendor of modems for Apple handsets debuting in 2023, this will take place.
In light of this, Baird kept its overweight recommendation on QCOM stock with a $250 target price.
It should be emphasized that Qualcomm Incorporated (QCOM)’s business includes more than just providing modems for the iPhone. The company benefits from a number of positive trends, including the proliferation of smart electronics in automobiles.
For instance, QCOM now trades with a beta of 1.26. QCOM is more volatile than the typical stock since the rest of the market is adjusted to a beta score of 1.0. In the same vein, market players should consider QCOM to be a little riskier than the typical stock.
