Wells Fargo Keeps a Sell Rating on QUALCOMM (QCOM)

QUALCOMM Incorporated (NASDAQ:QCOM) is one of the 10 Cheapest High-Quality Stocks to Buy According to Hedge Funds. On June 10, Wells Fargo analyst Aaron Rakers maintained a Sell rating on QUALCOMM Incorporated (NASDAQ:QCOM) with a price target of $140.

The maintained Sell rating by Wells Fargo comes after QUALCOMM Incorporated (NASDAQ:QCOM) recently announced the acquisition of Alphawave Semi, a company that deals in high-speed wired connectivity and computing technologies. Aaron Rakers noted that while the acquisition might strategically benefit QCOM’s data center ambition, it comes at a significant premium over Alphawave’s previous closing price. The deal worth $2.4 billion (all-cash) represents a 96% premium over Alphawave’s previous closing price, thereby raising concerns regarding QUALCOMM Incorporated’s (NASDAQ:QCOM) financial decision.

Analyst Aaron Rakers acknowledged that Alphawave’s technology complements QUALCOMM Incorporated’s (NASDAQ:QCOM) existing CPU and GPU design. However, the comparatively small financial value of the transaction might not significantly benefit the financial position of QCOM in the near term, thereby justifying his Sell rating.

QUALCOMM Incorporated (NASDAQ:QCOM) is a leading technology company that specializes in the development and commercialization of wireless technology. It also designs integrated circuits for mobile, IoT, and edge computing.

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