Qualcomm 5 days Rise 51% high 2000 years! Morgan Stanley is optimistic about becoming the world's largest chip maker

Release on : Apr 24, 2019

After Qualcomm Inc. signed a lawsuit settlement agreement with Apple Inc., its share price has soared, and it has rushed more than 50% in just five trading days. Morgan Stanley (commonly known as Morgan Stanley) believes that Qualcomm has the opportunity to become the world's largest chip maker.

Barron`s.com and CNBC reported on the 23rd that Morgan Stanley analyst James Faucette published a research report on the 23rd to Qualcomm's investment rating from the "neutral weight" As high as "plus". He pointed out that Qualcomm has unprecedented choices in areas other than mobile phones, and in the long run has the opportunity to become the largest semiconductor industry in the world.

Qualcomm jumped 5.76% on the 23rd and closed at 86.69 US dollars, which was the highest since January 3, 2000. The increase was the highest among the 30 constituent stocks of the Philadelphia Semiconductor Index. Since Qualcomm and Apple announced the reconciliation of the Century on April 16, Qualcomm's share price has been arrogant 51.66% (calculated at the closing price).

Faucette said that Apple's willingness to reconcile means that Qualcomm's intellectual property rights are indeed valuable. He believes that Qualcomm is still expected to have outstanding performance in areas other than the traditional smart phone market such as the automobile and the Internet of Things (IoT). The company is large in scale and has unique architecture research and development capabilities, and has a leading position in mobile communications. Have the opportunity to once again take the lead. He revised Qualcomm's target price from the original $55 to $95.

As the key promoter of the next generation 5G network, Qualcomm is the biggest reason for Morgan Stanley. Qualcomm gripped the 5G modem to develop the throat, which is one of the reasons why Apple had to reconcile with it. If not, the 5G iPhone will not be available in 2020 as scheduled.

Apple and Qualcomm announced on April 16 that they would settle the lawsuit, abandon all the lawsuits in the world, and sign a six-year licensing agreement (effective on April 1) and a multi-year chipset supply contract, which is unexpected. UBS analyst Timothy Arcuri estimated on April 18 that in addition to the $5 billion to $6 billion in settlement payments to Qualcomm, Qualcomm forecasts that earnings per share will increase by $2 due to the settlement agreement. Apple probably also agrees that each iPhone will pay $8 to $9 in royalties, far more than the $5 estimated by the stock.

UBS’s estimated payment is higher than Apple’s original premium paid to Qualcomm. When Apple Chief Operating Officer Jeff Williams was interviewed by the Fair Trade Commission (FTC), he said that Apple would pay Qualcomm's $7.5 premium for each iPhone. Apple and Qualcomm spokespersons are reluctant to respond to the amount of royalties.