Qualcomm Shares Rally on Supply Agreement with Apple

Qualcomm (QCOM) shares saw a 3.9% rally in the last trading session, closing at $110.28. The notable increase in volume indicates a higher number of shares being traded compared to a typical session. This comes after a 7.4% loss over the past four weeks.

One of the main factors behind the surge in Qualcomm shares is the company’s multi-year agreement with Apple Inc. The deal involves Qualcomm providing Snapdragon 5G Modem-RF systems for upcoming iPhone models. The agreement, which will run until 2026, highlights Qualcomm’s strong portfolio in the 5G technology space. It also helps solidify the company’s leadership position in this field.

This deal is significant for Qualcomm, as it has been facing potential revenue challenges in China due to restrictions on iPhone usage in government offices and state-backed entities. However, the partnership with Apple has alleviated these concerns and increased investor confidence in the stock.

In the upcoming report, Qualcomm is expected to post quarterly earnings of $1.91 per share, representing a 39% year-over-year decrease. Revenues are estimated to be $8.51 billion, down 25.3% from the same quarter last year.

While earnings and revenue growth are important indicators, it is also crucial to consider trends in earnings estimate revisions. In the case of Qualcomm, the consensus EPS estimate for the quarter has remained unchanged over the past 30 days. Monitoring QCOM going forward will reveal if this recent jump in stock price can lead to further strength.

Currently holding a Zacks Rank #3 (Hold), Qualcomm is a member of the Zacks Wireless Equipment industry. Another stock in the same industry, Comtech Telecommunications (CMTL), ended the last trading session with a 7.7% decrease at $8.96. Comtech has seen a 3.9% return over the past month.

Comtech is expected to report quarterly EPS of $0.17, a significant increase of 950% compared to the previous year. With a Zacks Rank of #3 (Hold), it will be interesting to see how the company performs in the upcoming report.

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