Apple: Sterne Agee Launches With Buy; Neutral On Qualcomm

Sterne Agee analyst Vijay Rakesh, who not all that long ago was toiling at ThinkEquity, late Monday picked up coverage of Apple (AAPL) with a Buy rating, while launching Qualcomm (QCOM) at Neutral. Now, I should point out that anyone familiar with his position on the stocks will not at all be surprised; Rakesh while still at ThinkEquity downgraded Qualcomm shares back in January on competitive concerns, and he was� previously bullish on Apple.

• On Apple, Rakesh set a $300 target, noting that the company “is a leader in the consumer space, well positioned always at the edge of the digital lifestyle revolution.” He contends the stock still sports a conservative valuation, with solid market share gains and earnings and revenue growth still ahead. The stock, he contends, :”should be a core holding of any portfolio.”
• On Qualcomm, he remains cautious. “While we continue to believe QCOM is at the leading edge of the 3G/4G revolution with a leading portfolio of chips and licenses, reversal in ASP trends and design wins will be key, in our view.” The strong secular growth of the global smart phone market, he notes, has attracted new players to the handset chip market, creating pressure on market share and ASPs.