SWKS - Embedded Expectations Analysis - 2020 08 31
Skyworks Solutions, Inc. (SWKS:USA) currently trades above recent averages relative to UAFRS-based (Uniform) earnings, with a 23.8x Uniform P/E. Even at these levels, the market has bearish expectations for the firm, and management may be concerned about their 5G ramp-up, BAW technology, and growth opportunitiesSpecifically, management may lack confidence in their ability to continue powering innovations in 5G applications through the Sky5 platform, execute on 5G technology, and continue delivering higher speeds and lower latency across 3G, 4G, and 5G. Moreover, they may be concerned about the technological difficulty in jumping from 4G to 5G, the pricing impact of 5G on mid- and lower-end platforms, and the growth ramp of 5G. Furthermore, management may lack confidence in their ability to increase market share with their Bulk Acoustic Wave (BAW) technology and they may have concerns about the potential of their R&D investments to accelerate growth. In addition, they may be exaggerating the opportunities of BAW solutions in WiFi, the innovation made from the Avnera acquisition, and their reputation and position with China's mobile players. Finally, management may lack confidence in their ability to meet gross margin guidance
Skyworks Solutions is a provider of analog semiconductors that connect people, places, and things, spanning a number of applications within the aerospace, automotive, broadband, cellular infrastructure, connected home, industrial, medical, military, smartphone, tablet and wearable markets. The company's product portfolio consists of various solutions, including: amplifiers, antenna tuners, attenuators, circulators/isolators, wireless analog system on chip, direct current (DC)/DC converters, demodulators, detectors, diodes, directional couplers, diversity receive modules, filters, front-end modules, hybrid, light emitting diode drivers, low noise amplifiers, mixers, and modulators.
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