Skyworks Solutions (NAS:SWKS) Graham Number

: $46.78 (As of Mar. 2023)

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Graham Number is a figure that measures a stock's fundamental value by taking into account the company's earnings per share and book value per share. The Graham number is the upper bound of the price range that a defensive investor should pay for the stock. According to the theory, any stock price below the Graham number is considered undervalued, and thus worth investing in.

As of today (2023-06-06), the stock price of Skyworks Solutions is $102.62. Skyworks Solutions's graham number for the quarter that ended in Mar. 2023 was $46.78. Therefore, Skyworks Solutions's Price to Graham Number ratio for today is 2.19.

The historical rank and industry rank for Skyworks Solutions's Graham Number or its related term are showing as below:

SWKS' s Price-to-Graham-Number Range Over the Past 10 Years
Min: 0.83 Med: 2.28 Max: 8.86
Current: 2.19

During the past 13 years, the highest Price to Graham Number ratio of Skyworks Solutions was 8.86. The lowest was 0.83. And the median was 2.28.

SWKS's Price-to-Graham-Number is ranked worse than
60.42% of 672 companies
in the Semiconductors industry
Industry Median: 1.77 vs SWKS: 2.19

Graham Number is a combination of asset valuation and earnings power valuation. It is a very conservative way of valuing a stock.

Skyworks Solutions Graham Number Historical Data

The historical data trend for Skyworks Solutions's Graham Number can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

* Premium members only.

Skyworks Solutions Annual Data

Trend

Sep13

Sep14

Sep15

Sep16

Sep17

Sep18

Sep19

Sep20

Sep21

Sep22

Graham Number

41.91

42.74

43.65

41.66

45.02

Skyworks Solutions Quarterly Data
	Jun18	Sep18	Dec18	Mar19	Jun19	Sep19	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23
Graham Number																40.69	41.67	44.99	45.54	46.78

Competitive Comparison

For the Semiconductors subindustry, Skyworks Solutions's Graham Number, along with its competitors' market caps and Graham Number data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

Annual Data Quarterly Data

Skyworks Solutions Graham Number Distribution

For the Semiconductors industry and Technology sector, Skyworks Solutions's Graham Number distribution charts can be found below:

* The bar in red indicates where Skyworks Solutions's Graham Number falls in comparison to its industry or sector. The grey bar indicates the Graham Number's extreme value range as defined by GuruFocus.

Skyworks Solutions Graham Number Calculation

Graham Number is a concept based on Ben Graham's conservative valuation of companies.

Skyworks Solutions's Graham Number for the fiscal year that ended in Sep. 2022 is calculated as

	Graham Number
=	sqrt of (22.5	*	Tangible Book per Share	*	EPS without NRI)
=	sqrt of (22.5	*	11.533	*	7.81)
=	45.02

Skyworks Solutions's Graham Number for the quarter that ended in Mar. 2023 is calculated as

	Graham Number
=	sqrt of (22.5	*	Tangible Book per Share	*	EPS without NRI (TTM))
=	sqrt of (22.5	*	14.036	*	6.93)
=	46.78

Skyworks Solutions (NAS:SWKS) Graham Number Explanation

Ben Graham actually did not publish a formula like this. But he wrote in The Intelligent Investor (1948 version) regarding to the criteria for purchases:

Current price should not be more than 15 times average earnings of the past three years.

Current price should not be more than 1.5 times the book value last reported. However, a multiplier of earnings below 15 could justify a correspondingly higher multiplier of assets. As a rule of thumb we suggest that the product of the multiplier times the ratio of price to book value should not exceed 22.5. (This figure corresponds to 15 times earnings and 1.5 times book value. It would admit an issue selling at only 9 times earnings and 2.5 times asset value, etc.)

Unlike valuation methods such as DCF or Discounted Earnings, the Graham number does not take growth into the valuation. Unlike the valuation methods based on book value alone, it takes into account the earnings power. Therefore, the Graham Number is a combination of asset valuation and earnings power valuation.

In general, the Graham number is a very conservative way of valuing a stock. It cannot be applied to companies with negative book values.

Skyworks Solutions's Price to Graham number Ratio for today is calculated as

Price to Graham number	=	Share Price (Today)	/	Graham number (Q: Mar. 2023 )
	=	102.62	/	46.78
	=	2.19

Be Aware

Please keep these in mind:

1. Graham Number does not take growth into account. Therefore it underestimates the values of the companies that have good earnings growth. We feel that if the earnings per share grows more than 10% a year, Graham Number underestimates the value.
2. Graham Number punishes the companies that have temporarily low earnings. Therefore, an average of earnings makes more sense in the calculation of Graham Number.
3. Graham Numbers underestimates companies that are light with book.

Skyworks Solutions Graham Number Related Terms

Thank you for viewing the detailed overview of Skyworks Solutions's Graham Number provided by GuruFocus.com. Please click on the following links to see related term pages.

Skyworks Solutions (NAS:SWKS) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Technology » Semiconductors » Skyworks Solutions Inc (NAS:SWKS) » Definitions » Graham Number

Comparable Companies

Traded in Other Exchanges

SWKS:Mexico AWM:Germany SWKS:Austria

Address

5260 California Avenue, Irvine, CA, USA, 92617

Website

https://www.skyworksinc.com

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.

Executives

Suzanne E. Mcbride	director	C/O IRIDIUM COMMUNICATIONS INC., 1750 TYSONS BOULEVARD, SUITE 1400, MCLEAN VA 22102
Eric Guerin	director	1950 HASSELL ROAD, HOFFMAN ESTATES IL 60169
Reza Kasnavi	officer: SVP, Tech. & Manufacturing	5260 CALIFORNIA AVENUE, IRVINE CA 92617
Karilee A Durham	officer: SVP, Human Resources	5260 CALIFORNIA AVENUE, IRVINE CA 92617
Alan S. Batey	director	300 RENAISSANCE CENTER, M/C: 482-C25-A36, DETROIT MI 48265-3000
Kimberly S Stevenson	director	199 FREMONT STREET, 7TH FLOOR, SAN FRANCISCO CA 94105
Carlos S Bori	officer: VP, Sales & Marketing	5260 CALIFORNIA AVENUE, IRVINE CA 92617
Robert John Terry	officer: VP, General Counsel &Secretary	5260 CALIFORNIA AVENUE, IRVINE CA 92617
Kris Sennesael	officer: SVP & Chief Financial Officer	5260 CALIFORNIA AVENUE, IRVINE CA 92617
Laura A Gasparini	officer: VP, Human Resources	20 SYLVAN ROAD, WOBURN MA 01801
Peter L Gammel	officer: Chief Technology Officer	600 LEXINGTON AVENUE, 29TH FLOOR, NEW YORK NY 10021
Victoria Vezina	officer: VP, Human Resources	20 SYLVAN ROAD, WOBURN MA 01801
Christine King	director	AMIS HOLDINGS, INC., 2300 BUCKSKIN RD, POCATELLO ID 83201
Bruce J Freyman	officer: Vice President - Operations	5221 CALIFORNIA AVE., IRVINE CA 92617
Donald W Palette	officer: V. P., Chief Financial Officer	20 SYLVAN ROAD, WOBURN MA 01801