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Skyworks Solutions (SWKS) Outpaces Stock Market Gains: What You Should Know

Zacks Equity Research

Skyworks Solutions (SWKS) closed the most recent trading day at $76.95, moving +1.46% from the previous trading session. This change outpaced the S&P 500's 0.38% gain on the day. Meanwhile, the Dow lost 0.04%, and the Nasdaq, a tech-heavy index, added 0.73%.

Coming into today, shares of the chipmaker had gained 10.65% in the past month. In that same time, the Computer and Technology sector gained 2.98%, while the S&P 500 gained 3.19%.

SWKS will be looking to display strength as it nears its next earnings release. In that report, analysts expect SWKS to post earnings of $1.34 per share. This would mark a year-over-year decline of 18.29%. Our most recent consensus estimate is calling for quarterly revenue of $765.94 million, down 14.35% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $6.19 per share and revenue of $3.39 billion. These totals would mark changes of -14.27% and -12.36%, respectively, from last year.

Investors should also note any recent changes to analyst estimates for SWKS. These recent revisions tend to reflect the evolving nature of short-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 7.11% lower. SWKS currently has a Zacks Rank of #4 (Sell).

Investors should also note SWKS's current valuation metrics, including its Forward P/E ratio of 12.26. For comparison, its industry has an average Forward P/E of 12.86, which means SWKS is trading at a discount to the group.

We can also see that SWKS currently has a PEG ratio of 1.3. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Semiconductors - Radio Frequency industry currently had an average PEG ratio of 1.5 as of yesterday's close.

The Semiconductors - Radio Frequency industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 248, which puts it in the bottom 4% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Make sure to utilize Zacks. Com to follow all of these stock-moving metrics, and more, in the coming trading sessions.

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