We maintain our Buy rating for Qualcomm Inc. (QCOM), the largest developer of digital mobile chipsets based on CDMA technology, ahead of fourth quarter fiscal 2008 financial results (ending September 30). The company's fundamentals remain compelling as it has several industry-leading innovative products for a variety of wireless applications.

Qualcomm's legal settlement with Nokia (NOK) for royalty related issues and a new 15-year licensing agreement significantly strengthens business planning. It is our view that demands for mobile broadband services and adoption of 3G cellular technologies will continue to grow throughout the world.

However, over the near-term, an extremely challenging global economy is likely to generate lumpy chipset sales and associated average selling prices. Based on current valuation levels and general economic concerns, we reduce our six-month valuation target for Qualcomm.