Qualcomm (QCOM) Stock Skyrockets on Apple Dispute Settlement
Shares of Qualcomm Inc. (QCOM) soared Tuesday to their highest levels since early October. The stock closed Tuesday more than 26% higher than the previous day’s close, on exceptionally high trading volume. In the process, Qualcomm’s stock price shot far above its 200-day moving average.
Qualcomm and Apple Settle Legal Dispute
The sharp and sudden surge occurred after the company announced the broad-based settlement of a longstanding legal dispute with Apple Inc. This dispute was over patent royalties relating to the iPhone’s internet connectivity. Among other stipulations, Tuesday’s agreement requires Apple to compensate Qualcomm with both a one-time payment as well as recurring licensing fees. While some investors may have expected such a settlement, the announcement was sudden and resolute, with little in the way of advance notice.
Qualcomm Skyrockets as Apple Remains Flat
Judging by Qualcomm’s stock move, it was quite evident that investors immediately recognized the benefits of the settlement for Qualcomm’s business. In contrast, Apple’s stock (AAPL) closed Tuesday flat, on low volume. This clearly underscores the market’s judgment that the settlement was much more beneficial to Qualcomm than Apple. Even in the market’s after-hours on Tuesday, Qualcomm’s stock dramatically extended its rise to new highs as investors continued to cheer Qualcomm’s unforeseen victory.
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Chief Market Strategist at The Technicals
With more than two decades of experience as an equity analyst for several major research firms, Don has covered individual stocks (both technically and fundamentally) across a wide variety of sectors and industries, including tech, financial, and retail. He has been quoted regularly in key financial media like Bloomberg and Reuters. Contact Don