Skyworks Solutions (NASDAQ: SWKS) stock price hit the highest level in the last 18 months. The shares breached physiological $100 mark, up more than 47% year to date. The stock had previously traded around $110 at the beginning of 2018. The share price rally is supported by attractive valuations along with a positive outlook for the next year.
The investors haven’t been focusing on significant revenue and earnings decline in the final quarter of fiscal 2019. Its strategy of delivering compelling 5G solutions to a diverse suite of customers and markets is adding to investor’s confidence.
Fiscal 2019 Remains Tough for Skyworks Solutions
The company has generated a considerable decline in the fourth quarter and fiscal 2019 financial numbers. Its fourth-quarter revenue of $827 million declined 18% from the same period last year. Fiscal 2019 revenue of $3.3 billion plunged from $3.8 billion in the past year.
It also experienced pressure on margins and earnings. It’s fiscal 2019 operating earnings came in at $853 million, down from $918 billion in the past year.
On the positive side, the company generated robust growth in cash flows. Its operating cash flow of $1.3 billion rose 8% from the year-ago period. The cash flows are offering a complete cover to cash returns. It has returned $932 million to investors in 2019 in the form of buybacks and dividends. In addition, the company achieved several operational milestones.
“Our systems-level approach, highlighted by our Sky5® platform, now includes strategic capabilities in BAW, Wi-Fi 6, MIMO and custom diversity receive. Collectively, these solutions are unleashing the true potential of 5G,” said Liam K. Griffin, president, and chief executive officer.
Outlook Support Skyworks Solutions Stock Price
The company expects to generate growth in Q1 revenue and earnings on a sequential basis. It forecasts Q1 revenue in the range of $870 and $890 million while diluted earnings per share are likely to stand around $1.65 at the midpoint of its revenue range. Overall, prospects for 5G are likely to support Skyworks Solutions’ stock price in the coming days.
