The landscape continues to shift in the chip market and semiconductor makers are doing what they can to shift with the times. The move to more mobile devices like smartphones and tablets and away from desktop PCs is expected to continue and gather strength in 2012. Today we’ll look at target prices and potential upside at five chip makers: Intel Corp. (NASDAQ: INTC), Advanced Micro Devices Inc. (NYSE: AMD), Broadcom Corp. (NASDAQ: BRCM), ARM Holdings plc (NASDAQ: ARMH), and Qualcomm Corp. (NASDAQ: QCOM). There appear to be some imminent changes to some longer term strategies in the chip making business.

Intel’s median target price is $27.00, unchanged from a month ago. The company’s shares posted a new high in the last month of $25.50, and are trading at $24.81 at around noon today. The implied gain based on the current target price and today’s share price is 8.8%. That’s the lowest among these five stocks, but Intel pays a 3.6% dividend yield, well above any of the others. CEO Paul Otellini told a technology conference yesterday that the company is focused on a three-pronged strategy aimed at emerging markets, where PC sales are strong; the Ultrabook market, which is off to a good start and expected to improve; and higher server sales. Otellini admitted that Intel doesn’t have a lot of mind share, or market share, in the mobile market, but expects that to change with the delivery of Windows 8 from Microsoft Corp. (NASDAQ: MSFT).

AMD’s median target price is $6.20, about -5% lower than it was a month ago. Shares are trading today at $5.62, for a potential gain of 10.3%. The company has given some hints about its future plans now that a new CEO is in place, and the big change is that AMD no longer sees Intel as its chief competitor. The integrated microprocessing-graphics market, known as System-on-a-Chip, is the market that AMD plans to focus on. Qualcomm and Nvidia Corp. (NASDAQ: NVDA), among others, are the leaders here, but AMD thinks that its ATI graphics capabilities give it a good shot to compete here. This strategy is expected to be spelled out in more detail in February.

Broadcom’s median target price is now $41.50, down about -7.8% from its level of a month ago. Shares are trading today at $29.86, which calculates to a potential upside of 39%. The company also got a boost today from a report out of Lazard Capital Markets indicating that Broadcom can afford to raise its dividend beyond the current yield of 1.2%. That may be true, but the high upside potential is a combination of a lower target price and a 14.4% drop in the share price over the past month.

ARM Holdings’ median target price has jumped about 32% in the past month, to $35.00. Shares are trading at $28.05 today, indicating an upside potential of 24.8%. ARM stands to benefit more than any other chip maker from the release of Windows 8, which will include support for the chip for the first time. There is some skepticism about the impact of Windows 8, given that it isn’t expected to be available until the end of next year.

Qualcomm’s median price target is $67.00, up about 3% from its level of a month ago. Shares are trading today at $54.90, for a potential upside of 22%. The company has been getting ratings boosts from analysts for weeks now, with Goldman Sachs including Qualcomm on its list of nine technology stocks to own in 2012. The recent announcement by HTC Corp. that it would not meet its fourth-quarter revenue target is expected to cost Qualcomm a penny in earnings for the quarter, so everything isn’t as rosy as it might appear.

It’s hard to argue against Qualcomm as the choice among these five stocks based on its potential upside and its reachable price target. Expectations for ARM are higher, but may be too high given the still-long wait for Windows 8.

Paul Ausick