It happened again. Qualcomm Inc. (NASDAQ: QCOM) reported its quarterly financial results and, subsequently, shares took a dive. This was nearly a repeat of fourth-quarter earnings where it had the largest dollar decline since 2000, but in fact it was worse. Shares were down around -11% as the trading was wrapping up in the last hours.

Even looking back to the fiscal third quarter of 2014 we would see the same situation. At this time shares fell only 6.7% on the next day and 10% in a week’s time.

After seeing this pattern for recent earnings reports, Investors should be wary of holding onto this stock during earnings.

The reason for the most recent fall in Qualcomm shares was lowered guidance. The implication is that the company’s Samsung business is stuttering – or at least getting skipped at the next launch:

We have lowered our outlook for the second half of fiscal 2015 in our semiconductor business, QCT, largely driven by the effects of:

• A shift in share among OEMs at the premium tier, which has reduced our near-term opportunity for sales of our integrated Snapdragon™ processors and has skewed our product mix towards more modem chipsets in this tier;
• Expectations that our Snapdragon 810 processor will not be in the upcoming design cycle of a large customer’s flagship device; and
• Heightened competition in China.

China continues to present significant opportunities for us, particularly with the rollout of 3G/4G LTE multimode, but also presents significant challenges, as our business practices continue to be the subject of an investigation by the China National Development and Reform Commission (NDRC).

Credit Suisse lowered its target price to $80 from $85 despite Qualcomm reporting its results ahead of Credit Suisse’s estimates. The earnings per share estimate was lowered by 5% or $0.24 for the 2015 fiscal year. Qualcomm believes that its total addressable market will grow by 15% this year but Credit Suisse sees it only growing around 6%.

Argus reiterated a Buy rating and lowered the price target to $80 from $89. The firm would go on to describe Qualcomm’s position:

Qualcomm has faced trials in the past and has come out stronger. We concur with the CEO that Qualcomm’s ‘fundamental competitiveness’ is intact. Although the lost socket in Galaxy S6 is a blow, turbulence is intensifying for every smartphone maker not named Apple; and Qualcomm is in many phones that could benefit from Samsung’s weakening position. We believe a settlement with NDRC would remove some of the uncertainty overhanging the QCOM shares. Earlier in January, we reduced our QCOM estimates to reflect our expectations for lower royalty payments on a per-device percentage basis.

Merrill Lynch reiterated a Neutral rating with an $80 price objective. Qualcomm came over the top of the estimates for the first fiscal quarter but the cautious outlook spurred analysts to reconsider valuations on the company. Merrill Lynch commented that unstable fundamentals going forward keep the firm on the sidelines with its call.

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Morningstar cut Qualcomm’s fair value per share estimate to $75 from $80. This was cut primarily on news that the Snapdragon 810 processor had been designed out of Samsung’s upcoming Galaxy S6 smartphone.

S&P Capital IQ lowered its target price by $7 to $75 based on a forward price-to-earnings (P/E) ratio of 15.2. The firm reduced the 2015 fiscal year estimates by $0.35 to $4.95 EPS and 2016 fiscal year by $0.10 to $5.60 EPS. S&P also expects to see 6% to 7% revenue growth for fiscal year 2015, despite less visibility on demand from China and some lost business from Samsung.

Topeka Capital Markets maintained a Hold rating on Qualcomm and lowered its price target to $70 from $75. Analyst, Suji Desilva said:

Qualcomm reported fiscal year first quarter 2015 (Dec.) revenue above consensus but guided fiscal year 2015 revenue and EPS below consensus reflecting increasing China competition, content loss at a flagship application processor customer and unfavorable chipset mix shift. While Qualcomm signed a wayward China licensee this quarter, the Company provided no update on the ongoing China investigation and continues to see other China licensees continue to underreport.

Shares of Qualcomm were down 10% at $64.13 in the last hour of Thursday’s trading. The stock has a consensus analyst price target of $79.53 and a 52-week trading range of $62.49 to $81.97.

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