Nomura Securities downgraded Qualcomm (NASDAQ: QCOM) from Buy to Neutral with a price target of $60.00 (from $75.00).

Analyst Romit Shah commented, "Admittedly, we should have made this change when issues with China surfaced a year ago. Our thesis was that Licensing (QTL) has been fraught with legal battles. And while handset OEMs have long been dissatisfied with terms, every patent-related dispute spanning Europe, Korea, Japan and India resolved in favor of Qualcomm. We expected a similar outcome after Qualcomm settled with China’s NDRC in February."

He added, "China though has proven to be a different animal. Qualcomm indicated last week that slower than expected progress in signing up new licensees on 3- mode devices sold in China. In addition, existing licensees are withholding payments as new contracts are negotiated. Furthermore, Chinese OEMs are gaining share around the globe, which means Qualcomm’s addressable TAM isn’t growing as fast as the overall smartphone market."

They believe that uncertainty around collections in China is going to persist.

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 $53.42 yesterday.