Q4 Preview: Skyworks (SWKS) to Show Benefit from Smartphone Boom

Shares of Skyworks Solutions Inc. (NASDAQ: SWKS) are up $0.70 or 3.08 percent to $23.46 in midday market movement on Thursday ahead of the company's fourth-quarter earnings release scheduled for after the closing bell.

The cellular handsets and analog semiconductors is expected by analysts to report earnings of $0.41 per share on revenue of $309.65 million.

In the third quarter, Skyworks reported earnings of $0.32 per share, beating the analyst estimate of $0.30 per share. The company reported third-quarter revenue of $275.4 million, compared to the consensus of $269.44 million.

Since the start of the fourth quarter, shares of Skyworks are up $5.36 or 29.5 percent. Year-to-date the stock is up $9.34 or 65.82 percent.

A valuation shows that Skyworks is going for a forward P/E of 28.84x full year 2010 estimates.

Data from Bloomberg shows that 15 analysts have a Buy rating on the stock, 2 have a Hold and 1 has a Sell. The average analyst price target on Skyworks is $24 with a target range of $19.75 to $26.

Skyworks' primary handset customers include Samsung, HTC, LG Electronics, Motorola (NYSE: MOT), Nokia (NYSE: NOK) and Research in Motion Ltd. (NASDAQ: RIMM).

Analyst Comments

Deutsche Bank maintains Buy rating on Skyworks with a price target of $25.

Deutsche Bank analyst says, "There will a tough competitive environment
for smartphones this Q4. We think this should actually benefit Skyworks
who supply many of the leading smartphones on the market. We also
expect new launches in 1QCY11 to further extend the company's lead in
smartphones."

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