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Skyworks Solutions Inc SWKS

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Morningstar’s Analysis

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1-Star Price

PREMIUM

5-Star Price

PREMIUM

Economic Moat

PREMIUM

Capital Allocation

PREMIUM

Skyworks Continues To Fire on All Cylinders With Impressive Broad Market Growth; $192 FVE

Brian Colello, CPA Sector Director

Analyst Note

| Brian Colello, CPA |

Skyworks Solutions reported predictably strong fiscal second quarter results and provided investors with a solid fiscal third quarter outlook, in light of tremendous demand for radio frequency, or RF, chip content going into Apple’s iPhones, other 5G smartphones, and broad market devices using WiFi 6 and other connectivity solutions. We are raising our fair value estimate for narrow-moat Skyworks to $192 from $176 as we’re more optimistic about near-term and long-term broad market revenue. We view shares as fairly valued. Given Apple’s tremendous recent earnings beat, however, we suspect that investors were betting on even stronger near-term growth, as the stock fell about 7% after hours. Overall, we remain pleased with Skyworks’ 5G content gains and are especially impressed with the company’s broad market revenue growth (a segment that should see continued growth after Skyworks closes its acquisition of Silicon Labs’ infrastructure and automotive business).

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Company Profile

Business Description

Skyworks Solutions produces semiconductors for wireless handsets and other devices that are used to enable wireless connectivity. Its main products include power amplifiers, filters, switches, and integrated front-end modules that support wireless transmissions. Skyworks' customers are mostly large smartphone manufacturers, but the firm also has a growing presence in nonhandset applications such as wireless routers, medical devices, and automobiles.

Contact
5260 California Avenue
Irvine, CA, 92617
T +1 949 231-3000
Sector Technology
Industry Semiconductors
Most Recent Earnings Mar 31, 2021
Fiscal Year End Oct 2, 2021
Stock Type Cyclical
Employees 10,000

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