Better Bet Than Skyworks Solutions Stock: Pay Less To Get More From FSLR
FSLR is SWKS’s peer in Semiconductors industry that has:
1) Lower valuation (P/OpInc) compared to SWKS
2) But higher revenue and operating income growth
This disconnect between valuation and performance could mean that you are better off buying FSLR stock vs. SWKS
Single stock can be risky, but there is a huge value to a broader diversified approach. Strategic asset allocation and diversification helps you stay invested. Did you know investors who panicked out of the S&P in 2020 lost significant upside that followed? Trefis High Quality Portfolio and Empirical Asset Management’s asset allocation approach are designed to reduce volatility so you can stay the course.
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Key Metrics Compared
| Metric | SWKS | FSLR |
|---|---|---|
| P/OpInc* | 19.2x | 18.0x |
| LTM OpInc Growth | -29.0% | 23.7% |
| 3Y Avg OpInc Growth | -25.3% | 165.8% |
| LTM Revenue Growth | -8.2% | 19.4% |
| 3Y Avg Revenue Growth | -9.4% | 19.8% |
OpInc = Operating Income, P/OpInc = Price To Operating Income Ratio
But do these numbers tell the full story? Read Buy or Sell SWKS Stock to see if Skyworks Solutions still has an edge that holds up under the hood. As a quick background, Skyworks Solutions (SWKS) provides proprietary semiconductor products for aerospace, automotive, broadband, cellular, connected home, entertainment, industrial, medical, military, and wearable technology markets.
This is just one approach to evaluate investments. Trefis High Quality Portfolio evaluates much more, and is designed to reduce stock-specific risk while giving upside exposure
Is The Mismatch In Stock Price Temporary
One way to check if Skyworks Solutions stock is expensive now versus the other tickers would be to see how these metrics compared across companies exactly a year ago. Specifically, if there has been a marked reversal in the trend for Skyworks Solutions in the last 12 months, then there is a chance that the current mismatch is likely to reverse. On the other hand, a persistent underperformance in revenue and operating income growth for Skyworks Solutions would reinforce the conclusion that the stock is expensive compared to its peers, but may not revert soon
Key Metrics Compared 1 Yr Prior
| Metric | SWKS | FSLR |
|---|---|---|
| P/OpInc* | 23.7x | 17.7x |
| LTM OpInc Growth | -34.6% | 57.3% |
| 3Y Avg OpInc Growth | -24.3% | 103.0% |
| LTM Revenue Growth | -12.9% | 26.7% |
| 3Y Avg Revenue Growth | -9.1% | 14.3% |
OpInc = Operating Income
Additional Metrics To Consider
| Metric | SWKS | FSLR |
|---|---|---|
| P/S | 2.9x | 5.8x |
| Market Cap (Current) | $ 11.6 Bil | $ 24.7 Bil |
| LTM Revenue | $ 4.01 Bil | $ 4.26 Bil |
| LTM Opinc | $ 603.60 Mil | $ 1.37 Bil |
| LTM Op Margin | 15.0% | 32.3% |
OpInc = Operating Income
Alternate buying based on valuation, while attractive, needs to be evaluated carefully from multiple angles. Such multi-factor analysis is exactly how we construct Trefis portfolio strategies. If you want upside with a smoother ride than an individual stock, consider the High Quality portfolio, which has outperformed the S&P, and clocked >91% returns since inception.