Citi Downgrades Qorvo Inc (QRVO) to Sell 'on China Smartphone Substitution Risk'

Citi analyst Atif Malik downgraded Qorvo Inc (NASDAQ: QRVO) from Neutral to Sell with a price target of $78.00 (from $116.00).

The analyst comments "QRVO/SWKS – D/G to Sell on China Smartphone Substitution Risk: We downgrade smartphone specialty semis QRVO/SWKS to Sell from Neutral on increased China substitution risk post recent Huawei Mate 60 phone launch which we believe uses domestic RF/connectivity chips. While QRVO/SWKS China sales have already come down over the last 1+ year due to weak China smartphone demand or ~21%/~11% of last reported FY, we believe increasing competition from Chinese domestic RF component makers will lead to potential share losses at OVX (Oppo, Vivo, and Xiaomi) and weak sales recovery in 2024. We lower our QRVO/SWKS CY24 EPS ~8%/7% and TPs to $78/$87 respectively. We value QRVO/SWKS at 12x/10x P/E or below 3-year average P/E of 14x/13x to reflect our share loss concerns in China."

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

Shares of Qorvo Inc closed at $94.90 yesterday.

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