Apple and Qualcomm settled their legal battle. Here’s what Wall Street analysts are saying – CNBC

Apple and Qualcomm settled their legal battle. Here’s what Wall Street analysts are saying – CNBC

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Tech giant Apple and Qualcomm have settled a legal dispute over royalties and patents, and it has Wall Street analysts buzzing over the chipmaker's prospects moving forward. Analysts at Stifel, J.P. Morgan and Evercore ISI all upgraded Qualcomm on Tuesday's news. Mizuho Securities, meanwhile, hiked its price target on Qualcomm to $82 per share from $62, implying a 16.3% upside from Tuesday's close. Canaccord Genuity also raised its price target to $89 per share from $75 and reiterated its buy rating on the company. Apple agreed to pay Qualcomm an undisclosed amount of money in the settlement and struck a chipset supply deal, which suggests the iPhone maker will buy Qualcomm chips for future smartphones. This removes a massive overhang from Qualcomm and clears the way for both companies to focus on 5G technology. However, some analysts say Qualcomm still faces headwinds, including a lawsuit from the Federal Trade Commission. .


Qualcomm shares skyrocketed 13 percent at Wednesday's opening of trading. Here is what analysts are saying: "The agreement opens up the opportunity to resume chipset supply to Apple, ranging from a sizeable market share on iPhone units in the (Sep) 2020 models to an upside opportunity from capturing a primary position on the device if competitors are unable to deliver a 5G chipset." "The resolution caps a multi-year period in which Qualcomm's stock has broadly been viewed as virtually uninvestible, and the resolution will likely go a long way toward assuaging investors who have been terrified of the potential for negative legal and regulatory outcomes." "While it is not 100% clear what the ongoing licensing payments will be and whether there are potentially any adverse implications to other customer agreements, this is clearly a meaningful positive for QCOM. We are not sure QCOM is completely out of the woods as we await a ruling from the FTC (expected imminently), though Apple's willingness to sign an agreement today would suggest a not too negative outcome is likely. And with agreements currently in place now with Apple, Samsung, and China, it increasingly looks like ....

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