Shares of Qualcomm Inc (NASDAQ: QCOM) are down roughly 35% versus the start of the year but CEO Cristiano Amon says the underlying business continues to be strong.
Qualcomm has a future in the auto industry
Amon sees big future for the multinational chipmaker in the automotive industry. In a recent interview on CNBC’s Mad Money with Jim Cramer, the chief executive said:
Automotive continues to be an exciting story. I think Qualcomm Inc digital chassis is resonating well with the automotive industry. When you think about it, we’re winning the future of the automotive semiconductor business.
In April, the San Diego-headquartered firm said chip sales jumped 52% year-on-year in its fiscal second quarter to $9.55 billion – well ahead of $8.86 billion that the Wall Street had expected.
The impact of lockdown in China
CEO Amon agreed the ongoing lockdown related to the resurgence of COVID in China is a near-term headwind. Reiterating confidence on the CNBC interview, however, he said:
Lockdown is going to impact the consumer business and phones. But we have seen how those things bounce back. In China, we’ve been focused on premium and high tier share wallet across Vivo, Oppo, Xiaomi, Honor and we continue to execute on that plan.
Wall Street, on average, is “overweight” on QCOM with an average price target of $204 a share that translates to a 70% upside from here. The stock currently trades at a PE multiple of 12.39.
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