Summit Research analyst Srini Sundarararjan says Qualcomm's (QCOM) limited experience building ARM multi-cores could make an acquisition an appealing option. The chip giant has about $3.4B on-shore cash and $26.2B offshore cash, meaning any potential deal would likely be contemplated using off-shore cash, Sundarararjan tells investors this morning in a research note. AMD (AMD), Applied Micro Circuits (AMCC) and Cavium (CAVM) should "make the first cut" of potential takeover targets for Qualcomm, the analyst speculates. Of those, he thinks Applied Micro looks like an "affordable choice."

As previously reported, Erste Group downgraded AMD (AMD) to Hold from Buy. The valuation is "significantly higher than the P/E ratio of the peer group," as well as compared to "much stronger competitor" Nvidia (NVDA), the analyst tells investors. The firm adds that upside potential for AMD "appears limited at present."