Ivan Feinseth Still Bullish On Skyworks After Street Retreats On Earnings Beat
Despite raising its dividend and posting beats in both sales and earnings per share, the Street pulled back from Skyworks Solutions Inc (NASDAQ: SWKS) Thursday after hours, prompting a 4-percent drop in share value.
But the bullish Ivan Feinseth, partner and chief investment officer at Tigress Financial Partners, is undeterred.
“Any weakness in the stock will be a significant buying opportunity,” Feinseth said Friday on Benzinga’s PreMarket Prep radio show. “I think the stock will go higher.”
He attributes the plunge to a “buy on the rumor, sell on the news” strategy, as the stock had run up ahead of earnings.
The Thesis
Considering Skyworks’ strong return on capital versus relatively low cost, Feinseth sees an intrinsic value of $132 — well below the stock’s current value around $106.
The firm is positioned to capitalize on continued growth and emerging trends in technology, particularly the expanding Internet of Things.
“They make chips that enable wireless connectivity, and everything that interacts with everything else will connect wirelessly,” Feinseth said. “From home control to home security to connected car to connected devices, I think Skyworks is going to play a role in that.”
He considers technology a driver of the U.S. economy, catalyzing advancements in sectors from health care to transportation. The resulting importance of developing autonomous vehicles and health-monitoring products, such as sweat-monitoring and glucose-testing wearables, lend extra weight to the Skyworks bull argument.
“Connectivity to broadcast info in real time is an opportunity for Skyworks,” Feinseth said.
PreMarket Prep is a daily morning show about short-term trading ideas and technical setups. It airs live from 8–9 a.m. ET here, and the podcast is here
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