Qualcomm Faces Revenue Risks as Apple Shift Sparks Valuation Debate

QUALCOMM (QCOM) stock has been on an upswing over the past month, but its valuation is being questioned by some investors. Despite a recent price increase of 7.12%, the company's share price has still dropped by 21.86% in the last 90 days.

The 1-year total shareholder return stands at 7.77%, while the 3-year total shareholder return is a more impressive 69.40%. This indicates that long-term holders have seen solid gains, but there are concerns about the company's short-term prospects.

One of the main risks facing QUALCOMM is its reliance on Apple for revenue. The shift away from Qualcomm modems by Apple could reduce revenue in the near term. However, the company is diversifying its revenue streams through investments in automotive, data centers, and advanced wearables.

A recent valuation narrative suggests that QUALCOMM's fair value is $196.27, which is higher than its current share price of $168.74. This valuation is based on a specific earnings and revenue path over the next several years, including rapid growth in automotive and industrial IoT segments.