Skyworks Earnings: Reducing Fair Value to $95 from $115 as Its Recovery Appears to Be Modest

Narrow-moat Skyworks Solutions reported decent fiscal fourth-quarter earnings that aligned with our expectations but provided investors with a disappointing forecast, particularly on the profitability front. We are reducing our fair value estimate to $95 from $115 based on lower near-term revenue forecasts and long-term profitability assumptions. Shares still appear undervalued to us, although we now view the margin of safety for investors as slightly slimmer than what we previously signaled.