Qualcomm Rebounds on Apple Renewal
Qualcomm's stock surged 6% in afternoon trading after reversing an initial selloff following its renewed agreement with Apple. The chipmaker's shares rose to $205.21, a sharp rebound from their earlier drop. Across the past month, Qualcomm's stock has gained 28%, making this stumble on the renewal news even more notable.
The VanEck Semiconductor ETF (NASDAQ:SMH) and the Invesco QQQ Trust (NASDAQ:QQQ) were up 1% and 0.44%, respectively, but nowhere near Qualcomm's pace. Bernstein analyst Stacy Rasgon pointed out that the lack of specificity in the renewal announcement has given investors some pause.
The Apple agreement carries more weight for Qualcomm, which has long faced the risk of losing its customer. The imbalance in stakes between the two companies explains the larger swing in Qualcomm's stock. Without disclosed terms, any estimate of the agreement's value to Qualcomm remains uncertain, helping explain why the first reaction tended negative.