Skyworks Solutions Inc: The Best Pure-Play In The Secularly Growing RF Market

Skyworks Solutions Inc (NASDAQ:SWKS) shares are soaring today after the chip maker blew consensus estimates when it reported its first fiscal quarter results yesterday. The company’s Dec-16Q EPS beat the Street by $0.03 and for the Mar-17Q the company guided revenues and EPS higher than the Street.

In reaction, Oppenheimer top analyst Rick Schafer increased his estimates for CY17E (estimated calendar year 2017) and CY18E EPS from $6.50/$7.47 to $6.51/$7.55. As such, the analyst also raised his price target to $105 from $100, while reiterating an Outperform rating.

Schafer wrote, “We expect Y/Y acceleration through CY17 as CY16’s iP6s inventory issues abate. We expect SWKS to deliver above-market growth driven by 1) continued smartphone content gains; 2) China share gains through strengthening baseband partnerships and demand for integrated (vs. discrete) RF solutions; 3) seasonal uptick at Samsung; and 4) continued double-digit RF complexity increases. With its “onestop-shop” systems-level approach, we see SWKS uniquely positioned to benefit from rising RF content.”

“We view SWKS as the best pure-play in the secularly growing RF market, with an established record of execution. We’d remain buyers here,” the analyst concludes.

According to, which measures analysts’ and bloggers’ success rate based on how their calls perform, 5-star analyst Rick Schafer has a yearly average return of 15% and a 73% success rate. Schafer has a 34% average return when recommending SWKS, and is ranked #30 out of 4365 analysts

Out of the 22 analysts polled by TipRanks, 14 rate Skyworks Solutions stock a Buy, 6 rate the stock a Hold and 2 recommend Sell. With a downside potential of 1.6%, the stock’s consensus target price stands at $86.35.

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