Qualcomm Inc. stock price rose around its former $ 100 high, set two decades ago on Thursday after a chip maker revealed it had settled a licensing dispute with the world’s largest smartphone maker, clearing the way for the new 5G standard to begin.
shares set an intraday record price of $ 107.40 on Wednesday, the peak of its former maximum of $ 100.00 set on January 3, 2000, just before the fall of dot-com. Then, the next event came to $ 1
In addition to mid-term revenue estimates on Wall Street on Wednesday, Qualcomm also announced a long-awaited settlement of patent licenses with Huawei, which it teased a year ago when it recorded the results of the settlement with Apple Inc. AAPL. .
Of the 29 analysts covering Qualcomm, it has 18 buy or overweight ratings, eight hold ratings and three sell ratings. According to FactSet, 18 of them increased their price targets, leading to an average price target of $ 113.24, compared to the previous $ 98.48.
Later on Wednesday, it was discovered that the Chinese company Huawei had surpassed the South Korean company Samsung Electronics Co. 005930.
as the world’s largest supplier of smartphones due to supply disruptions caused by the COVID-19 pandemic.
Susquehanna analyst Christopher Rolland, who has a positive rating on Qualcomm and raised his price target to $ 125 from $ 110, called the settlement a “show star” in a note entitled “Huawei … Out.a.the.wei”. in Wednesday’s earnings report.
Huawei is estimated to pay QualL or QTL licensing fees for QualL, or QTL, $ 1.8 billion royalties.
“After the settlement of Huawei, COVID continues to adversely affect global phone units, although the high-end and 5G segments continue to grow, helping to support Qualcomm’s profitability,” said Rolland.
Cowenne analyst Matthew Ramsay, who has above-average ratings and raised his price target to $ 130 from $ 115, said the Huawei deal unlocked a share of “purgatory” revenue of about $ 1 or more.
“With all the world’s major OEMs now licensed for 5G, doubts about the QTL business model should be firmly set aside,” Ramsay said.
JP Morgan analyst Samik Chatterjee, who was overweight and raised his price target from $ 120 to $ 120, said Qualcomm’s leadership in pre-launch 5G technology was a “key” settlement point.
“In addition, we believe that reaching an agreement with Huawei over increased tensions between the US and China, as well as recent US restrictions that limit HiSilicon’s ability to access 5G chipsets, will lead to expectations of a bullish case over potential Qualcomm shipments. 5G. Huawei to support the launch of smartphones in the future, “said Chatterjee.
Oppenheimer analyst Rick Schafer, who has a Qualcomm rating, said all the positives of the settlement would remain marginal.
“We see an additional risk for QTL from uncertainty in the sale of 5G smartphones due to demanding consumer spending and potentially unfavorable FTC decisions,” Schafer said.
Qualcomm shares are 21% higher per year compared to a 16% increase in the PHLX SOX semiconductor index,
18% profit for the technically difficult Nasdaq Composite Index COMP,
and an increase of 0.6% by the S&P 500 SPX index,