According to the Wall Street Journal (WSJ), QUALCOMM, Inc. (NASDAQ:QCOM) is in talks to acquire NXP Semiconductors NV (NASDAQ:NXPI), a deal that while not a “certainty,” the WSJ believes could become an agreement within the next several months.

On back of the WSJ report, Jefferies top analyst Mark Lipacis reiterates a Buy rating on shares of NXPI with a $130 price target, which represents a nearly 27% increase from where the stock is currently trading.

“While not a certainty, we think a deal is feasible, and believe that NXPI could fetch $136-$172 per share. Worth noting is that NXPI CEO Clemmer was previously the CEO of Agere, and engineered its sale to LSI, driving >130% of stock appreciation w/in 14 months of taking the helm.”

The analyst sees this as a “strategic” acquisition, and as such, one that bears a steeper risk in both integration and valuation.

Yet, from Lipacis’ perspective, “Regardless if there is a deal, we see catalysts,” concluding that from his analysis published in “Semis M&A Handbook: More to Come,” “We show that semi P/E multiples are 1) positively correlated with net capital return, and 2) inversely correlated with net debt ratio. We expect NXPI’s multiple to expand as it lowers debt and buys back stock.”

As usual, we like to include the analyst’s track record when reporting on new analyst notes to give a perspective on the effect it has on stock performance. According to TipRanks, top five-star analyst Mark Lipacis has achieved a high ranking of #13 out of 4,200 analysts. Lipacis upholds a 75% success rate and yields 20.8% in his annual returns. When recommending NXPI, Lipacis realizes 21.4% in average profits on the stock.

TipRanks analytics demonstrate NXPI as a Strong Buy. Based on 11 analysts polled in the last 3 months, 10 rate a Buy on NXPI, while 1 maintains a Hold. The 12-month price target stands at $107.80, marking a 5% upside from where the shares last closed.