Schaeffer's Top Stock Picks for '25

Why Skyworks Solutions’ Stock Looks Like an Affordable Buy

SWKS reported fiscal Q4 and full year financial results last week

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Skyworks Solutions, Inc. (NASDAQ:SWKS) is an American semiconductor company with engineering, marketing, operations, sales, and support facilities located throughout Asia, Europe, and North America. SWKS products are applied within the aerospace, automotive, broadband, cellular infrastructure, connected home, entertainment and gaming, industrial, medical, military, smartphone, tablet and wearable markets. This afternoon, SWKS was last seen trading up 2.6% at $168.41. 

On Nov. 4, Skyworks Solutions reported its fiscal fourth-quarter results. The company's revenue for the fourth quarter of 2021 was $1.311 billion. Skyworks' reported operating income of $487.6 million with earnings per share of $2.62 for fiscal Q4. 

Skyworks stock has increased about 14% year-over-year and is up 25% since bottoming out at a 52-week low of $134.28 last November. However, shares of SWKS have grown 10% year-to-date and have shed 17% from its all-time high of $164.06 reached in April. Moreover, Skyworks Solutions offers a forward dividend of $2.24 with a dividend yield of 1.37%.

Those looking to join the SWKS bandwagon can do so at a steal right now. Skyworks stock's Schaeffer's Volatility Index (SVI) of 28% sits higher than just 21% of readings from the past 12 months, suggesting options players are pricing in low volatility expectations for the stock at the moment. 

From a fundamental point of view, Skyworks stock does not offer the greatest security or consistency, with the company’s top- and bottom-lines declining on an annual basis between fiscal 2018 and fiscal 2020. However, SWKS has managed to improve greatly over the past 12 months. In addition, Skyworks stock has a decent forward price-earnings ratio of 14.24, which is a considerable improvement on its current price-earnings ratio of 18.29. Overall, SWKS has potential to return to its previous highs in the coming year as Skyworks stock’s valuation begins to price-in the company’s boost in revenues and net income.

 
 

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