11 Most Undervalued Quality Stocks to Buy Now

4. Qualcomm Inc. (NASDAQ:QCOM)

Forward P/E Ratio as of April 14: 11.98

Number of Hedge Fund Holders: 79

Qualcomm Inc. (NASDAQ:QCOM) develops and commercializes foundational technologies for the wireless industry. It operates through three segments: Qualcomm CDMA Technologies (QCT), Qualcomm Technology Licensing (QTL), and Qualcomm Strategic Initiatives (QSI). It also provides development, services and sells products to the US government agencies and their contractors.

On March 11, TD Cowen analyst Joshua Buchalter maintained a Buy rating on the company with a $195 price target. The analyst is optimistic about the company’s ability to expand its business beyond the traditional handset market. The firm thinks that Qualcomm’s focus on low-power and connectivity-focused product portfolio will help it tap into high-growth opportunities within the IoT and automotive sectors.

However, Qualcomm’s chipset business within its QCT (Qualcomm CDMA Technologies) generates most of its revenue, particularly the handset sales. In FQ1 2025, QCT achieved record revenues of $10.1 billion. Handset revenues alone reached a record $7.6 billion, which was up 13% year-over-year. For FQ2, Qualcomm Inc. (NASDAQ:QCOM) projects QCT handset revenues to increase by ~10%, which will be driven by the increased shipments of the Samsung Galaxy S25 smartphones.

Nightview Capital is bullish on the company due to its shift into high-growth automotive and IoT markets. It stated the following regarding QUALCOMM Incorporated (NASDAQ:QCOM) in its Q4 2024 investor letter:

“Semiconductors are the unsung heroes of the modern economy, powering everything from AI and 5G to electric vehicles and renewable energy systems. Without them, innovation stalls. The semiconductor industry has entered a supercycle, driven by unprecedented demand across industries that rely on advanced computing. And while this notoriously boom and bust industry has seen cycles before we believe this cycle remains in relative infancy.

These advancements aren’t incremental. As AI systems scale, the need for cutting-edge semiconductors will only accelerate. We believe the companies at the forefront of this revolution are foundational to the next wave of global progress.

Qualcomm Inc. (QCOM): Core Opportunity: Qualcomm is transitioning beyond its traditional handset business, focusing on high-growth markets in Automotive and Internet of Things to drive future revenue streams. We have already seen this strategy flowing through the PnL and we are confident in the firm’s execution abilities going forward.

Competitive Advantage: Automotive Strength: Automotive revenue rose ~55% in FY 2024 to $2.9 billion, further supported by over 10 new design wins with global automakers for advanced driver-assistance systems (ADAS), connectivity, and digital cockpit solutions.

IoT Growth: IoT revenue reached $1.4 billion, reflecting steady traction in smart devices and industrial applications…” (Click here to read the full text)