Here’s Why Barclays’ Tom O’Malley Kept a Sell on Qualcomm (QCOM) Farooq Wed, November 11, 2026 at 1:02 PM EST 4 min read QCOM +4.64% ^IXIC +2.17% ^GSPC +1.55% Trade QCOM on Coinbase Trading disclosure Trading disclosure The above button links to Coinbase. Yahoo Finance is not a broker-dealer or investment adviser and does not offer securities or cryptocurrencies for sale or facilitate trading. Coinbase pays us for certain activity generated through this link. Prices displayed are informational.
We just published a list of the Analysts Just Slashed Their Price Targets on These 10 Stocks and Qualcomm (NASDAQ:QCOM) ranked 10th on this list.
Wall Street had its worst day in 19 months last Thursday, with chip stocks leading the selloff. The Nasdaq Composite fell 5.52% to 24,315.00, its biggest one-day drop since the April 2025 tariff announcement. The S&P 500 fell 4.36% to 7,353.73, erasing about $3 trillion in market value and marking its worst day since that same tariff crash. The Dow lost 3.44%.
The Nasdaq is now in a correction, more than 10% below the record close it set last month. Volume was heavy: 26.9 billion shares changed hands, against a 20-session average of 17.7 billion.
The trigger was politics. Investors worried about tighter AI regulation after Democrats won control of Congress, including in states where opposition to new data centers has been growing. The Philadelphia SE Semiconductor index fell more than 12% in one session, its worst day since March 2020. Candidates in both parties had campaigned against AI data centers, Yahoo Finance's Jared Blikre reported.
Melissa Brown, global head of investment decision research at SimCorp, said some newly elected members of Congress and governors want to slow the pace of AI infrastructure development, and that any slowdown would raise concerns. We covered the group's earlier pullback in our list of oversold AI stocks that Wall Street analysts saw 50%+ upside in, published before the selloff.
Jed Ellerbroek, portfolio manager at Argent Capital Management, called Thursday "the capitulation phase for the data center capex beneficiary stocks" and said the size of the moves looked excessive. Chip stocks did bounce on Friday: the semiconductor index rose 4.2% and the Nasdaq gained 1.1% to 24,579.43, and the S&P 500 rose 0.32% to 7,376.86, while the Dow slipped 0.46% to 51,285.73. But the Nasdaq still posted its fourth straight weekly decline, down 3.4% for the week, while the S&P 500 fell 2.7%, its worst week since June, and the Dow fell 0.9%.
Readers weighing how far the technology sector has fallen can also look at our roundup of technology stocks trading near 52-week lows that analysts favor. Through Thursday's close, the S&P 500 was still up 7.4% for 2026 and the Nasdaq up 4.6%. Friday's jobs report showed employers added 165,000 jobs in October, against 59,000 expected, and the unemployment rate fell to 4.1%. Traders expect the Federal Reserve to raise interest rates next month, following a hike in September.
Qualcomm made it to our list because it has an average upside potential of 10%. Barclays analyst Tom O'Malley kept a Sell rating on Qualcomm on November 5 and cut his price target to $150 from $180 because he projects handset revenue falling 26% in fiscal 2027. TD Cowen, the same day, stayed at Buy but lowered its target to $185 from $200, citing weaker gross margins and supply limits.
The cuts followed Qualcomm's earnings report. Adjusted earnings per share were $2.17 for the quarter. Total revenue fell about 7% to 8% to roughly $10.4 billion, handset revenue fell 26% to about $5.1 billion, and guidance of $2.15 to $2.35 per share for the December quarter came in below the $2.27 analysts expected. The stock dropped about 9.5% the next day.
Qualcomm makes the Snapdragon chips used in many smartphones, and its newer businesses are growing. Automotive revenue rose 89%, management is targeting $5 billion in data center revenue for fiscal 2027, and an Amazon agreement is worth up to $60 billion over 10 years. We looked at how that growth is running into the handset slump in our analysis of its automotive business and handset earnings.
While we acknowledge the risk and potential of QCOM as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.
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