Intel and Altera Spike on Merger Talk; Apple Falls on Android Pay: Tech Winners & Losers

NEW YORK ( TheStreet) -- Intel ( INTC) and Altera ( ALTR) spiked Friday on reports the two are close to a $16 billion merger. Avago Technologies ( AVGO) jumped after a price target increase. Apple ( AAPL) fell a day after rival Google ( GOOGL) unveiled plans for a mobile payment system, Android Pay.

Altera soared 4% to end the session at $48.85, while Intel jumped 1.3% to close at $34.46.

Intel is close to reaching a $16 billion buyout deal for Altera, according to a Reuters report. A deal may be struck in the coming days, according to the report.

Altera reportedly rebuffed Intel's earlier offer of $54 a share in April and a stand-still agreement between the two companies that prevents Intel from launching a hostile bid for the company is set to expire on June 1, according to Reuters.

Meanwhile, although Intel jumped Friday, it is stepping into a heavy resistance zone, testing its February high. The February high hit a cap at $34.75. The chip giant has traded in a tight range during the year, with a 52-week high of $37.90 and low of $26.72.


Avago Technologies spiked 4% to close at $148.07.

The chip maker gained after Brean Capital increased its price target on the company to $180 from $145, citing its recent merger announcement with Broadcom (BRCM).

Brean described the $37 billion merger as creating a "powerhouse communications semiconductors" company. The merger is the largest to date in the chip industry.

Avago also reported mixed second-quarter results after the markets closed Thursday, saying it earned $2.13 per share on $1.61 billion in revenue. Analysts were expecting earnings of $2.01 a share on nearly $1.64 billion in revenue.


Apple fell 1.1% to end the day at $130.28.  

The computer maker slipped a day after Google announced at its developers conference plans to kick off Android Pay. That would put Google in direct competition with Apple's newly launched Apple Pay.

For Apple, investors are hoping Apple Pay will become a massive revenue driver and profit machine for the company as mobile payments become more widely accepted. But Apple, which is relying on its iPhones to serve as the conduit for these mobile transactions, may find great competition with Google.

Previously, unit sales of Android smartphones have eclipsed the number of iPhones in the market, setting up the potential for more Android Pay transactions to be taking place. However, in the fourth quarter, Apple was able to turn the tables around, but it remains unclear how long that will hold.

This article is commentary by an independent contributor. At the time of publication, the author held no positions in the stocks mentioned.

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