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Sally Jones
Sally Jones
Articles (580) 

Skyworks Solutions 52-Week Low - Behind the iWar of Smartthings

April 03, 2013 | About:

Are ubiquitous connectivity and infotaining cars on your wish list? Perhaps not, but you may be holding Skyworks' products in your hands and just don’t know it. Skyworks Solutions Inc. (NASDAQ:SWKS) makes the semiconductors in Apple Inc. products and has done well in the “iWar” of mobile smartthings. The revolutionary microchip maker’s performance is intimately tied to the sales of its customers Apple Inc., Samsung and others.

As an innovator of high performance analog semiconductors used in a broad range of industries, Skyworks Solutions has miniature electronics for almost every kind of high-tech application, such as intelligent thermostats, heart defibrillators, and new Iridium satellites, to name a few. Skyworks Solutions Inc. is also poised to lead the revolution of cars "going digital" in the next five years. The company expects to saturate the infotainment car market by contributing to a digital communications feature for the automotive industry.

The GuruFocus 52-week low screener reveals that Skyworks Solutions (NASDAQ:SWKS) is at a 52-week low of $20.48 (high was $31.44). According to the GuruFocus Value Screen for 52-week lows, SWKS is 34.5% off high but nevertheless, is held by a number of top investor Gurus, namely Lee Ainslie, founder of Dallas-based Maverick Capital.

After increasing his SWKS position by 15.55% last fall, Guru Lee Ainslie held 10,319,381 shares, but reduced his position in fourth quarter 2012 to 7,408,746 shares, while many top Gurus sold out.

His holding history:

With SWKS dropping for six consecutive quarters, Guru Ainslie still holds megashares. With this company's massive applicability and wide product development reach, the Skyworks horizon looks good according to company leaders. In his second fiscal quarter 2013 outlook, Donald W. Palette, vice president and CFO of Skyworks, stated, “Given order visibility and specific product launches, we expect to continue to gain market share and capture additional content per platform in the seasonally low March quarter. Specifically, for the second fiscal quarter of 2013, we anticipate revenue to be up 15 percent year-over-year with better than normal seasonality to approximately $420 million with non-GAAP diluted earnings per share of $0.47.”

David J. Aldrich, president and CEO of Skyworks, also commented: “As our results and guidance reflect, Skyworks is enabling anytime, anywhere communications across a diverse set of end markets and applications. We’re capitalizing on growing consumer and enterprise demand for ubiquitous connectivity spanning all modes of wireline and wireless communications. In fact, our analog semiconductor solutions are increasingly at the heart of everything from smartphones to smart appliances to home security systems to satellites to medical sensors to hybrid vehicles. This market diversity coupled with Skyworks’ leadership scale, product breadth and system IP is setting the stage for continued market outperformance and shareholder value creation.”

Skyworks Solutions (NASDAQ:SWKS) has a market cap of $3.93 billion, a P/E of 18.4 and a P/S of 2.5. Stock price for SWKS is down 22% in the last year, off 5% since January. When GuruFocus performed a financial and performance check up on the company, it found two good signs: Skyworks Solutions Inc. has no debt, and the company’s operating margin is expanding, usually a good sign.

Lee Ainslie’s top buys, sells, and holdings:

Check out the GuruFocus special feature 52-week low screener. This special feature helps you find stocks hitting new lows but are still held by top investor Gurus and Insiders. If billionaire Gurus own these stocks and are still increasing their positions, it means that they believe the stocks are undervalued. Researching these stocks may help you find deep valued stocks.

About the author:

Sally Jones
Sally Jones writes about Real Time Picks. She says, "I truly enjoy watching the Gurus in realtime and telling their story."

Rating: 3.9/5 (9 votes)


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