Leading semiconductor manufacturer
Skyworks Solutions Inc.
) recently announced that its board of directors has decided to
initiate a quarterly dividend payout to provide attractive
risk-adjusted returns to its stockholders. The proposed dividend
of 11 cents per share will be paid during the third quarter of
fiscal 2014, which begins in April.
Skyworks continues to capitalize on global mobile connectivity
and demand for high-performance solutions across a diverse set of
vertical markets. The company supports connectivity across
a number of strategic applications including medical devices,
wearable technologies, home automation and hybrid vehicles as
well as smartphones and tablets.
The company is confident of maintaining adequate liquidity to
initiate a regular quarterly dividend. In the last reported
quarter (first quarter fiscal 2014), Skyworks generated $159
million of cash from operations and had cash and equivalents of
The company also repurchased approximately 670,000 shares of
common stock during the reported quarter. Moving forward,
Skyworks intends to return significant cash to its shareholders
through dividends and share repurchases.
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In order to fuel its growth engine, Skyworks aims to capitalize
on three business segments − mobile Internet, vertical markets
and analog components. Demand for mobile Internet applications is
exploding with the broad proliferation of smartphones, net books,
note books, caplets and other forms of embedded wireless devices.
Skyworks also continues to consolidate its share across the
mobile Internet spectrum. This covers everything from net books
and data cards to smartphones, and even entry-level handsets.
The market is estimated to have 50 billion connections by 2020.
Some of the fastest-growing segments include medical, industrial,
automotive and smart energy where connectivity is being adopted
for the very first time. Perfect quality, environmentally
friendly products and sustainable business practices are key
differentiators for this company in a very competitive
environment. Consequently, we expect Skyworks to post solid
operating results in the near future.
Skyworks currently has a Zacks Rank #1 (Strong Buy). Other stocks
in the industry that look promising and are worth looking into
Himax Technologies, Inc.
), each carrying a Zacks Rank #2 (Buy).