Skyworks Solutions, Inc. (SWKS) recently announced that several of its front-end solutions are being leveraged by the industry’s leading baseband providers for their smartphone platforms which currently support world’s leading mobile broadband standards.
Skyworks continues to weather the turbulent economic conditions well. The company has strategically positioned itself as a diversified company. Skyworks continues to benefit from strong underlying demand in the mobile Internet market driven by market share gains and new product ramps. Skyworks saw a healthy holiday season demand across all categories of mobile Internet devices, including smartphones, e-readers and tablets.
According to Skyworks, several of its newest power amplifiers and front-end modules deliver approximately 50% power added efficiency with a 30% smaller footprint.
In particular, Skyworks’ solutions are compatible with the world’s first fully integrated long-term evolution (LTE) modem chipset which contains an integrated dual core application processor for smartphones, tablets and other mobile devices.
As carriers like Verizon and AT&T accelerate their LTE plans, Skyworks expects a solid opportunity for growth in the coming years with its broad product portfolio.
Last month, Skyworks Solutions posted a net income of $57.1 million or 30 cents per share in the first quarter of fiscal 2012 compared to a net income of $60.8 million or 32 cents per share in the year-ago quarter and a net income of $64.2 million or 34 cents per diluted share in the fourth quarter of fiscal 2011.
Earnings estimates have moved a bit lower of late. The current Zacks Consensus Estimate is $1.58, down by $0.02 in the last seven days. One of the five analysts covering the stock has decreased his estimate for 2012.
Skyworks reported revenues of $393.7 million in the first quarter, up 17% year over year and surpassed management’s guidance of $390.0 million.
Going forward, management expects revenues of approximately $360 million in the second quarter of fiscal 2012. Gross margin is projected at around 43.0% – 43.5%. Skyworks expects EPS of 40 cents in the third quarter.
We continue to maintain a Neutral recommendation on Skwyorks. Nevertheless, we have a Zacks #2 Rank on the stock which translates into a short-term rating of Buy.
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