Why QCOM’s Stock Price Jumped This Week
Last week was Lyft’s turn but this week let’s talk about a microchip stock called Qualcomm (Ticker symbol:QCOM).
QCOM’s stock price realized some significant gains this past week after it’s settlement with Apple Inc. that concluded in the agreement that Apple would pay back all royalties that had been withheld dating back to late 2018 that it owed QCOM, as well as a six year deal with a 2 year extension option. This resulted in it’s stock price jumping over 50% in the past week of trading. For those of you who have been following QCOM stock for a while, you may have noticed that this is the highest it’s been since 2000. With this analysts have also raised their Price Target’s (PT’s) for the stock. Morgan Stanley upgraded it’s PT from $55 to $95 in this article published on Seeking Alpha.
Seeking Alpha is one of my top news sources that I go to for financial information on stocks. I highly suggest adding the website to your favorites or downloading the app to your iPhone/Android. Click here to download.
This has been quite a parabolic move.
Why Apple was bound to lose this lawsuit
Apple depends on QCOM because it uses QCOM chips in it’s iPhones. With the coming of 5G networks QCOM is going to play a major role with multiple smartphone companies bringing 5G to the market. Apple had raised some distaste for having to pay too much in royalties per phone back to QCOM, but in the end all roads lead back to QCOM for Apple. If they want to remain as one of world’s leading smartphone brands and compete with the likes of Samsung and Huawei, QCOM is the key. Although QCOM has been in the midst of many legal battles, I speculated that this would almost be a sure fire win for them when I bought shares of their stock back in March before the big move.
On a side-note, a mentor of mine shared a story with me about he sat down and had a conversation with a Venture Capitalist back in the early 90’s. Him and the VC ran into each other at event where they shared a few drinks and exchanged pleasantries. During the conversation the fellow talking to my mentor mentioned that he was a VC and that he had recently become one of the first investors in this startup company called QCOM. The stock at the time was trading below $5 if not lower. So after the conversation my mentor ending up buying a decent amount of shares of the stock. In the next few weeks he saw his shares make a significant jump and made the decision to sell for a profit based off his investment strategy. Had have held until the present day it would’ve been worth thousands!! Mind blowing right!? He had shared this story with me when I expressed interest in buying QCOM a few months back.
“It’s better to hang out with people better than you. Pick out associates whose behavior is better than yours and you’ll drift in that direction.” — Warren Buffett
Find a mentor in whatever field you are trying to master. Build a relationship, pick their brains. They’ve been down this journey ahead of you and are familiar with the traps and pitfalls that come with the experience. You’ll drift towards success in that area.
QCOM holds over 100,000 patents in the microchip industry. Many companies depend on their chips in their smartphones. These organizations will be leaning heavily on QCOM in the coming months with the 5G emergence. QCOM also has the opportunity to move in to other spaces such as automotive industry with the coming of self-driving vehicles.
***I currently own shares of QCOM Stock.***
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