Earnings Beat: Skyworks Solutions, Inc. Just Beat Analyst Forecasts, And Analysts Have Been Updating Their Models

There's been a notable change in appetite for Skyworks Solutions, Inc. (NASDAQ:SWKS) shares in the week since its quarterly report, with the stock down 12% to US$90.30. It looks like a credible result overall - although revenues of US$1.0b were in line with what the analysts predicted, Skyworks Solutions surprised by delivering a statutory profit of US$1.14 per share, a notable 15% above expectations. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

Check out our latest analysis for Skyworks Solutions

Following the recent earnings report, the consensus from 26 analysts covering Skyworks Solutions is for revenues of US$4.21b in 2024. This implies a small 7.3% decline in revenue compared to the last 12 months. Statutory earnings per share are forecast to decline 16% to US$4.45 in the same period. In the lead-up to this report, the analysts had been modelling revenues of US$4.44b and earnings per share (EPS) of US$4.79 in 2024. The analysts are less bullish than they were before these results, given the reduced revenue forecasts and the small dip in earnings per share expectations.

The consensus price target fell 9.4% to US$105, with the weaker earnings outlook clearly leading valuation estimates. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. Currently, the most bullish analyst values Skyworks Solutions at US$154 per share, while the most bearish prices it at US$83.00. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.

One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. We would highlight that revenue is expected to reverse, with a forecast 14% annualised decline to the end of 2024. That is a notable change from historical growth of 9.1% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 17% annually for the foreseeable future. It's pretty clear that Skyworks Solutions' revenues are expected to perform substantially worse than the wider industry.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Skyworks Solutions. On the negative side, they also downgraded their revenue estimates, and forecasts imply they will perform worse than the wider industry. The consensus price target fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of Skyworks Solutions' future valuation.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have estimates - from multiple Skyworks Solutions analysts - going out to 2026, and you can see them free on our platform here.

You can also see our analysis of Skyworks Solutions' Board and CEO remuneration and experience, and whether company insiders have been buying stock.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.