I’ve had July 17 circled on my calendar in anticipation of this moment. Skyworks Solutions (SWKS) just reported stunning sales and earnings growth for the fiscal third quarter. Skyworks is a rising star in the analog semiconductors industry and it is benefiting from the global adoption of wireless technology.
Compared with Q3 2013, operating income soared 60% to $179.1 million. Adjusted earnings were $0.83 per share, topping the $0.80 consensus EPS estimate by 4%. Over the same period, revenue jumped 35% to $587 million. This surpassed the company’s and analyst expectations, which called for $570 million in revenue.
Even better, the company expects robust growth in the coming quarter. For Q4 2014 Skyworks forecasts 43% sales growth and 56% adjusted earnings growth. This is substantially higher than the Street view, which had called for 27.5% top-line growth and 35.9% bottom-line growth. So we’ll likely see a round of earnings revisions as analysts process this new information.
Skyworks’ Board of Directors also declared a dividend of $0.11 per share. Shareholders of record on August 7 will be paid on August 7. SWKS currently pays a 0.9% dividend yield, which is on the higher end of the industry average. All-in-all, this was a strong earnings report, and I consider SWKS an A-rated Strong Buy.
P.S. If you’d like more information on SWKS, including my current price limit for the stock, you can access it through a risk-free trial of Blue Chip Growth.