As Zacks senior technology analyst notes, Skyworks Solutions (SWKS) has been a solid Buy call since its price pulled back to under $6 per share in the first half of the year. We found out why is is keeping his Buy recommendation on the communications industry supplier at the present time:
'Skyworks recently reported financial results for Q4:FY2007. Revenue was $190.4 million, in line with our estimate. Proforma earnings per share were $0.14, which beat our estimate by a penny. Actual results benefited from lower-than-expected operating expense and tax. Gross margin increased to 39.2% from 23.4% in the prior-year period but was flat sequentially.
'The company sequentially grew its cash and equivalents balance in the September quarter to $253.8 million, from $234.6 million, as it generated roughly $30 million of cash flow from operations. Going forward, Skyworks expects Research in Motion (RIMM) in U.S. and Media Tek in China to become important customers for the company.
'Management expects revenues in Q1 of FY2008 to come around $207 million, while EPS is projected between $0.15 and $0.17. Additionally, management claims it is seeing good order visibility into the coming quarter, and expects its newest front-end module designs to ramp. We have a Buy rating on the stock and have set a target price of $11.'
Read the full analyst report on SWKS.
Read the full analyst report on RIMM.
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