By Tova Cohen
TEL AVIV (Reuters) - Shares in Israel's Ceva Inc hit a record high after firms specializing in dissecting and analyzing electronic devices revealed its chip technology is used in Apple Inc's iPhone 7 and 7 Plus phones.
Ceva licenses its designs to chipmakers such as Intel and Samsung, who embed its digital signal processors within their chip sets, reducing the time and cost it takes them to bring products to market.
These "teardowns", as they are known in the electronics industry, showed that for the first time Intel's thin modem, which uses Ceva's design, is in some versions of Apple's new smartphone. For the last several years Intel's competitor Qualcomm dominated the market for these chips.
"Since 2012 our numbers were down because of Qualcomm," Ceva Chief Financial Officer Yaniv Arieli told Reuters on Tuesday. "This year that's changing and our customers are successful in launching their own LTE chips," he added, referring to the chips used in 4G mobile communications.
Ceva's Nasdaq-traded shares jumped 10.3 percent to a record $34.99 on Monday in more than four times its daily average volume.
Analysts raised their forecasts for the company, citing the teardowns, which can be found on the websites www.chipworks.com and www.ifixit.com.
"We view Ceva as one of the main beneficiaries from the launch of the iPhone 7/7+," said Benchmark analyst Gary Mobley.
He estimated that Intel and Qualcomm may equally split the thin modem supply for the iPhone, which could boost Ceva's adjusted earnings per share in 2017 by as much as 25 cents. Analysts on average forecast Ceva will earn 84 cents a share in 2016.
Canaccord raised its price target for Ceva to $40 from $38 and its adjusted earnings per share estimate to $1.11 from $1.05.
Ceva estimates its designs will be included in almost 200 million LTE phones in 2016 and is targeting 400-500 million phones annually within three years. Arieli said this was not just from high-end Apple and Samsung phones but from emerging economies where smartphones costing under $100 are more popular.
(Editing by Louise Heavens)