Raymond James reiterates its ‘strong buy’ rating on Qualcomm

Qualcomm Inc (NASDAQ: QCOM) shares are still down more than 10% from their year-to-date high in February. But Raymond James continues to be confident that the stock will eventually pick up.

Analyst Chris Caso sees an over 30% upside in Qualcomm stock

In a note this morning, Raymond James analyst Chris Caso reiterated his “strong buy” rating on Qualcomm with a price target of $190 that represents a more than 30% upside from here.

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Caso doesn’t see a threat to Qualcomm even if one of its biggest customers, Apple Inc, realizes plans of making its own chips.

“Qualcomm has a very attractive risk/reward setup as valuation is reasonable even excluding Apple,” the analyst wrote.

In comparison, Canaccord Genuity has an even higher price target of $225 a share on Qualcomm.

Jim Lebenthal agrees with Raymond James’ bullish call

Apple used Qualcomm’s chips in its 2020 5G iPhone lineup and signed a six-year license agreement for its wireless patents that secured $4.7 billion worth of licensing revenue for the chipmaker.

Now that the tech giant has announced plans of designing its own chips, investors are worried that Qualcomm’s revenue could take a hit if it loses business from the iPhone maker. Not Cerity Partners’ Jim Lebenthal, though.

Agreeing to Raymond James’ bullish call on CNBC’s “Halftime Report”, he said:

“Apple can go through all the trouble of designing its own chips and trying its way out of Qualcomm, but you still have the intellectual property that you have to pay Qualcomm for. That’s the thesis here, it’s taking too long to develop. But I’m not giving up on Qualcomm, not for a second.”

Lebenthal did, however, give up on Intel recently, which was resumed with a ‘hold’ rating at Deutsche Bank on Wednesday.