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With a market cap of $14.2 billion, Skyworks Solutions, Inc. (SWKS) specializes in high-performance analog and mixed-signal semiconductors that enable wireless connectivity. The Irvine, California-based company’s products serve a range of applications, including automotive, industrial, medical, and smartphone markets, and are distributed globally.
Shares of the wireless chips maker have significantly underperformed the broader market over the past 52 weeks. SWKS has dipped 2.3% over this time frame, while the broader S&P 500 Index ($SPX) has gained 35.9%. In 2024, shares of SWKS are down 21.7%, compared to SPX’s 25.8% increase on a YTD basis.
Narrowing the focus, SWKS has also lagged behind the SPDR S&P Semiconductor ETF's (XSD) 32.1% return over the past 52 weeks and an 8.8% YTD gain.
Skyworks Solutions shares fell 3.5% following its Q3 earnings release on Jul. 30 due to lower-than-expected revenue of $905.5 million, down 15.5% year-over-year. The decline was driven by sluggish demand in the automotive industry, with key customers like Tesla and Ford experiencing weaker sales, as well as a reduction in content for the next iPhone generation. Despite an improved Q4 revenue outlook, concerns over Skyworks' declining mobile and automotive segments weighed on investor sentiment.
For the current fiscal year, which ended in September, analysts expect SWKS’ EPS to decline 31.5% year-over-year to $5.21. However, the company’s earnings surprise history is promising. It beat the consensus estimates in the last four quarters.
Among the 24 analysts covering the stock, the consensus rating is a “Hold.” That’s based on five “Strong Buy” ratings, 16 “Holds,” one “Moderate Sell,” and two “Strong Sells.”
On Oct. 25, Piper Sandler lowered its price target on SWKS to $95, maintaining a “Neutral” rating due to weaker performance in mobile-oriented segments. The firm noted challenges in handset units and lagging growth relative to AI-driven semiconductor markets, limiting near-term upside potential.
The mean price target of $111.82 represents a premium of 27.1% to SWKS’ current levels. The Street-high price target of $140, implies a potential upside of 59.1% from the current price.
On the date of publication, Sohini Mondal did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
