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Skyworks Solutions (SWKS) may be an attractive option for your investment portfolio, considering its strong cash yield, solid fundamentals, and undervalued price. There have been quite a few positive developments for SWKS of late. Last week, Skyworks reported Q4 fiscal 2025 revenue of $1.1 billion, exceeding guidance. In late October, Skyworks announced a $22 billion merger agreement with Qorvo - semiconductor player focused on products for wireless, wired, and power markets. The merger aims to create a U.S.-based global leader in high-performance RF, analog, and mixed-signal semiconductors, with complementary portfolios and expanded reach in mobile and diversified markets including AI and the automotive sector. Let’s review the key numbers: Cash Yield: Few stocks provide a free cash flow yield of 10.4%, but Skyworks Solutions stock is one of them. Fundamentals: The last 12 months showed a revenue growth of -2.2% and an operating margin of 12.8%, indicating reasonable fundamentals. Valuation: SWKS stock is currently trading at 40% below its 2-year high, 13% below its 1-month high, and at a price-to-sales ratio lower than its 3-year average. Free Cash Flow Yield is defined as free cash flow per share divided by the stock price. Why is it significant? If a company generates a high amount of cash per share, it can be utilized to support additional revenue growth, or simply distributed as dividends or share buybacks for shareholders. For context, Skyworks Solutions develops proprietary semiconductor products for various sectors including aerospace, automotive, broadband, cellular, connected home, entertainment, industrial, medical, military, and wearable technology markets. While individual stocks can either surge or decline, one key aspect remains: maintaining your investment. High Quality Portfolio assists you in achieving that. MORE FOR YOU But do these figures reveal the complete picture? Read Buy or Sell SWKS Stock to determine whether Skyworks Solutions still maintains a competitive advantage beneath the surface. This is just one perspective on stocks. Trefis High Quality Portfolio considers much more and is tailored to mitigate stock-specific risk while providing upside potential. The Point? The Market Can Notice, And Reward The following statistics come from a high FCF yield selection strategy executed between 12/31/2016 and 6/30/2025. The stats are computed based on selections made monthly, and assume that a stock, once chosen, cannot be chosen again for the next 180 days. Average 6-month and 12-month forward returns of 10.4% and 20.4%, respectively Win rate (the percentage of picks that yield positive returns) of approximately 74% for the 12-month period Not overly reliant on market downturns. Even during non-crash periods, this strategy achieves an average 12-month return of nearly 18% with a 70% win rate. But Consider The Risk That said, Skyworks Solutions (SWKS) is not exempt from significant sell-offs. It dropped more than 81% during the Dot-Com bubble burst and incurred a 66% decline during the Global Financial Crisis. The inflation shock impacted it by nearly 60%. Even more recent downturns in 2018 and during the Covid pandemic caused it to fall around 47%. Strong fundamentals do not guarantee protection against market downturns. However, the risk is not confined to major market downturns. Stocks can decline even when markets are performing well – consider events such as earnings releases, business updates, and outlook revisions. Read SWKS Dip Buyer Analyses to learn how the stock has bounced back from sharp declines in the past.
