Samsung deal lifts Broadcom shares

Shares of Irvine-based Broadcom Corp., a maker of chips for wireless devices, climbed after analysts said a new contract with Samsung Electronics Co. could increase the company’s share of the cellphone-chip market.

Broadcom said Monday that it had expanded its relationship with Samsung and would provide processors for the South Korean company’s third-generation, or 3G, phones. Samsung is the world’s second-largest cellphone maker.

“We view today’s Samsung announcement as another strong endorsement of the company’s capabilities in the wireless handset market,” Deutsche Bank Securities analysts wrote in a note to investors. They reiterated their “buy” rating on the stock.

Piper Jaffray & Co. analyst Amit Kapur wrote that “commercial availability of these phones could lay the foundation” for market share gains by Broadcom in the 3G market.

And Lehman Bros. Holdings Inc. analysts said they expected Broadcom to report “solid” third-quarter results, which are scheduled to be released Oct. 23. Wall Street analysts estimated that Broadcom earned 27 cents a share in the quarter, up from 19 cents a share a year earlier.