UPDATE: BofA/Merrill Lynch Upgrades Qualcomm (QCOM) to Buy

(updated to add analyst comment)

BofA/Merrill Lynch analyst Tal Liani upgraded Qualcomm (NASDAQ: QCOM) from Neutral to Buy, price target $105.00 (from $90.00).

The analyst comments "We hope that now the Apple dispute has been resolved, management’s visibility has improved to the point where disclosure on units and pricing can be provided, as well as more granular data on QCT. We calculate Apple’s current royalty at $6-7 per device, which supports management’s $2 EPS target from Apple, with an added benefit of $400mn expected annual decline in legal expenses starting in 2020. While we reduce our estimates to account for the near term challenges, we price the stock on a full cycle estimate of $6.30 EPS (see note), and apply a 17x multiple, slightly above the 15x level of the semiconductor industry as we apply a premium for high-margin QTL revenues."

For an analyst ratings summary and ratings history on Qualcomm click here. For more ratings news on Qualcomm click here.

Shares of Qualcomm closed at $83.48 yesterday.

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