Qorvo (QRVO) Stock Forecast & Price Target

Qorvo is expected to see continued growth in their High Performance Analog segment and potential gains in ETP/Modems and sustained double-digit growth in HPA as ACG declines and CSG remains flat. Although they are facing near-term pressure, they have a solid plan in place for FY27 with a targeted adjusted EPS of $7.00 with gross margins above 50%. The merger with Skyworks (SWKS) is expected to close this year, which will likely lead to further growth and improved earnings in FY27 and FY28.

Qorvo is facing a negative outlook due to a disappointing outlook for the company's March quarter revenue and EPS, which fell below analyst estimates by $100 million and $0.17 respectively. This is primarily attributed to a decline in Qorvo's low-end mass market Android business, which the company has decided to exit in favor of the more profitable premium flagship tier of the handset market. Additionally, Qorvo is expected to lose market share in Apple's Ultra-High Band PAD socket, adding to the decline in expected revenue for the coming year. Despite the company's efforts to improve its gross margin through a shift towards higher-margin segments and cost-cutting measures, the decline in its cellular business and challenges with its planned merger with Skyworks have led to a decrease in projected 2027 EPS to $6.62 from a previous estimate of $6.83. Until there is evidence of the company's ability to replace lost revenue and maintain margins, as well as a resolution of regulatory challenges for the planned merger, the outlook for Qorvo remains negative.