QCOM Should I Buy
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Based on the data provided, Qualcomm Inc (QCOM) is not a strong buy at the moment for a beginner investor with a long-term horizon. The stock is facing significant headwinds due to memory shortages and declining handset volumes, which are expected to persist throughout 2026. While there are some long-term growth opportunities in AI and IoT, the short-term challenges, including bearish technical indicators and mixed analyst sentiment, suggest it may be better to wait for more favorable conditions before investing.
The technical indicators for QCOM are bearish. The MACD histogram is negative and contracting, the RSI is neutral at 28.19, and the moving averages indicate a bearish trend (SMA_200 > SMA_20 > SMA_5). The stock is trading near its support level of 135.217, with resistance at 143.205. This suggests limited upside potential in the short term.
Qualcomm's strategic positioning in AI inference suggests significant long-term growth potential.
Growth in the automotive and IoT sectors could provide new revenue streams.
The stock is considered oversold, presenting a potential long-term buying opportunity.
Memory shortages are expected to pressure handset volumes and revenue throughout
Hedge funds are selling the stock, with a 195.24% increase in selling activity over the last quarter.
Analysts have downgraded the stock, citing challenges in the smartphone market and constrained DRAM availability.
In Q1 2026, Qualcomm's revenue increased by 5% YoY to $12.25 billion. However, net income dropped by 5.53% YoY to $3.004 billion, EPS declined by 1.77% YoY to 2.78, and gross margin fell by 2.19% YoY to 54.55. This indicates mixed financial performance with growth in revenue but declining profitability.
Analyst sentiment is mixed to negative. Recent downgrades include Daiwa (Neutral, $140 target), Morgan Stanley (Underweight, $132 target), and Susquehanna (Neutral, $140 target). Some analysts maintain a Buy rating but have lowered price targets, reflecting cautious optimism. The consensus suggests short-term challenges outweigh long-term potential.
