Skyworks Solutions Inc. Stock Buy Recommendation Reiterated (SWKS)

Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.

NEW YORK ( TheStreet) -- Skyworks Solutions (Nasdaq: SWKS) has been reiterated by TheStreet Ratings as a buy with a ratings score of B- . The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, attractive valuation levels, increase in net income and good cash flow from operations. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity.

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Highlights from the ratings report include:
  • The revenue growth came in higher than the industry average of 11.0%. Since the same quarter one year prior, revenues rose by 15.2%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • SWKS has no debt to speak of therefore resulting in a debt-to-equity ratio of zero, which we consider to be a relatively favorable sign. Along with this, the company maintains a quick ratio of 4.05, which clearly demonstrates the ability to cover short-term cash needs.
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Semiconductors & Semiconductor Equipment industry. The net income increased by 16.4% when compared to the same quarter one year prior, going from $57.13 million to $66.49 million.
  • Net operating cash flow has significantly increased by 91.21% to $147.68 million when compared to the same quarter last year. In addition, SKYWORKS SOLUTIONS INC has also vastly surpassed the industry average cash flow growth rate of -93.00%.

Skyworks Solutions, Inc., together with its subsidiaries, offers analog and mixed signal semiconductors worldwide. Skyworks has a market cap of $4.66 billion and is part of the technology sector and electronics industry. The company has a P/E ratio of 22.2, above the S&P 500 P/E ratio of 17.7. Shares are up 19.5% year to date as of the close of trading on Tuesday.

You can view the full Skyworks Ratings Report or get investment ideas from our investment research center.

--Written by a member of TheStreet Ratings Staff.

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