Shares of wireless chip maker Skyworks Solutions (SWKS, Financial) fell 6% in the morning session. This decline occurred after semiconductor stocks that design chips for smartphones dropped, following Wall Street analysts' concerns about the shipping time of iPhone 16 Pro models compared to the previous year.
Skyworks Solutions Inc. (SWKS, Financial) is currently priced at $96.32 and has a market capitalization of $15.38 billion. Despite the recent drop, the company maintains strong financial health. It has a P/E ratio of 19.86 and a price-to-book ratio of 2.43, reflecting reasonable valuations in the semiconductor sector. The GF Value indicates that Skyworks Solutions is "Fairly Valued" with a GF Value of $90.21. You can find more details on its GF Value page.
Skyworks Solutions shows robust financial strength, boasting an Altman Z-Score of 7.47, suggesting low bankruptcy risk. Additionally, the company's Beneish M-Score of -3.01 implies that it is unlikely to be a manipulator. The current ratio of 5.75 and quick ratio of 4.29 further highlight its solid liquidity position. Notably, the company’s debt-to-equity ratio stands at a low 0.19, underscoring strong balance sheet management.
However, the company faces some warning signs. Skyworks Solutions Inc. has experienced a decline in revenue per share over the past 12 months and a long-term downtrend in gross margin, with an average annual decline rate of -1.8%. Operating margins have also been decreasing at an average rate of -4.4% per year over the past five years. Additionally, the company’s tax rate appears unusually low, which may not be sustainable.
Despite these challenges, Skyworks Solutions continues to deliver value to shareholders with a dividend yield of 2.84%, close to its 10-year high. The company has shown a solid dividend growth rate of 13.6% over the past five years. Furthermore, the stock’s free cash flow yield is impressive at 9.57, indicating that Skyworks Solutions is generating significant cash relative to its share price.
The company's stock has experienced some volatility with a beta of 1.36, suggesting higher risk compared to the overall market. However, with a Price/Free Cash Flow ratio of 10.09 and robust cash flow growth metrics, Skyworks Solutions remains a strong player in the semiconductor industry. Investors should keep an eye on the company’s next earnings report, estimated for November 1, 2024, for further insights into its performance.
