Chip stock Qualcomm (NASDAQ:QCOM) got a little extra life behind it today as an analyst upgrade caught investors’ attention. It wasn’t much of a boost—Qualcomm shares are up fractionally in the last of Friday morning’s trading—but even a fractional boost is a boost nonetheless.
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The boost in question came from Citi Research, who hiked its rating from Neutral to Buy and raised its price target from $110 to $160. The move came after Citi got a look at the overall technology supply chain from its visit to the Consumer Electronics Show (CES) event in Las Vegas this week. After viewing the various products, it became clear that the market for wireless technology is poised to improve. That, in turn, should light a fire under Qualcomm, as the wireless market should moderate in the second half of 2024.
Qualcomm Could Benefit from AI
One thing that Citi didn’t point out that Qualcomm itself did was the rise of generative AI. That field—which has been discussed extensively over the last several months—should also boost Qualcomm’s operations. With generative AI coming to phones, desktops, and even cars, the idea is that hardware will need to be refreshed. That could allow Qualcomm to fill many more orders as the hardware needs to change to accommodate AI. And, with the smartphone correction now largely concluded, that weight should also be off Qualcomm’s back, clearing a path toward future gains.
Is Qualcomm a Buy, Sell, or Hold?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on QCOM stock based on 13 Buys, five Holds, and one Sell assigned in the past three months, as indicated by the graphic below. After a 19.32% rally in its share price over the past year, the average QCOM price target of $143.18 per share implies 2.53% upside potential.
