10 Best Self-Driving Technology Stocks To Buy According to Hedge Funds

4. QUALCOMM Incorporated (NASDAQ:QCOM)

Number of Hedge Fund Investors In Q3 2024: 74

QUALCOMM Incorporated (NASDAQ:QCOM) is one of the largest semiconductor designers in the world. Its products are widely used in the smartphone industry, and the firm also has a presence in the automobile market through platforms such as CV2X. QUALCOMM Incorporated (NASDAQ:QCOM)’s expertise in semiconductor design and its broad product portfolio which ranges from CPUs and GPUs to neural processors has also enabled it to develop solutions for ADAS systems. The firm caters to this market through its Snapdragon Ride products which allow for navigation and obstacle detection among other features. However, QUALCOMM Incorporated (NASDAQ:QCOM) generates the majority of its revenue through smartphones which makes it vulnerable to the cyclical market. Advances in semiconductor fabrication and British chip design house Arm’s strategy of providing off-the-shelf solutions to businesses also create risks to QUALCOMM Incorporated (NASDAQ:QCOM)’s business.

Aristotle Capital Management mentioned QUALCOMM Incorporated (NASDAQ:QCOM) in its Q2 2024 investor letter. Here is what the fund said:

“Qualcomm, a leading wireless communications technology company, was the largest contributor for the quarter. After a period of weaker global demand for smartphones (driven by a slowdown in China) and elevated channel inventory, demand from Chinese handset manufacturers accelerated 40% year‐over‐year. More importantly, in our opinion, Qualcomm continues to execute on a previously identified catalyst of shifting its business mix beyond smartphones. The company announced increased progress for its automotive and Internet of Things (IoT) solutions. Within auto, the increase in vehicle content has resulted in 35% year‐over‐year revenue growth, with a design win pipeline of ~$45 billion, keeping the company on track to achieving ~$4 billion in auto‐related revenues by 2026. In recent years, despite persistent threats of insourcing from large clients (most notably Apple), Qualcomm has been able to retain its high market share in handsets while simultaneously expanding in non‐smartphone devices. We believe this progress is a testament to Qualcomm’s history of high (and productive) R&D spending, resulting in technological superiority. We believe Qualcomm’s technologies will continue to benefit as the world stays on a path toward a proliferation of connectivity between varying devices and as AI applications extend from the cloud to on‐device.”