Demand for high-end and flagship smartphones is strong, according to supply chain research performed by KeyBanc. This bodes well for Qualcomm (QCOM -3.53%), reasons KeyBanc analyst John Vinh. Vinh reiterated his overweight rating on Qualcomm stock to start the week and raised his price target from $180 to $205. The new price target represents a potential upside of about 18% over the next 12 months or so.
QCOM Qualcomm
NASDAQ · As of 4:00 PM ET 10/16/26
Winning market share
KeyBanc sees momentum building for Qualcomm on multiple fronts in the smartphone market. While smartphone maker Samsung opted to use either Qualcomm's Snapdragon chips or its home-grown Exynos chips in its Galaxy S24 family, depending on the model and market, KeyBanc expects Qualcomm to regain a 100% market share for Samsung's upcoming Galaxy S25 family.
KeyBanc also sees Qualcomm gaining market share in the mid-range from Taiwan-based MediaTek. Qualcomm has seen its overall smartphone processor market share slip from 32% in the third quarter of 2022 to 23% in the fourth quarter of 2023, according to Counterpoint Research. MediaTek is the market leader globally, with a particularly strong presence in low-end and mid-range phones.
An Arm PC opportunity
On top of solid prospects in the smartphone market, KeyBanc sees an opportunity for Qualcomm to make a splash in the PC market. Windows laptops powered by Qualcomm's upcoming Elite X chips are set to launch later this year, and early benchmarks are promising.
The challenge will be selling consumers on a non-Intel, non-Advanced Micro Devices laptop. It may take quite a while for the typical laptop buyer to warm up to an Arm-based laptop running a Qualcomm processor.
Is Qualcomm stock a buy?
Analysts expect Qualcomm to produce earnings per share of about $9.75 this year, which puts the forward price-to-earnings ratio at about 17.5. That doesn't look like an unreasonable valuation, given the company's growth opportunities in the mid-range smartphone market and the PC market.
