Skyworks Retraces 2009-2011 Bull Move, Market Following (SWKS, RFMD, SOXX, AAPL, SPY, DIA Performance)

Source: Skyworks June Presentation
Since the bull market began in early 2009, I continued to watch smartphone semiconductor company Skyworks Solutions (SWKS) as a signal for continued market appreciation (1, 2). The iPhone and iPad use Skyworks semiconductors, or specifically the Skyworks power amplifier module SKY77340 (or now SKY77344?). Skyworks broke out of an eight year sideways channel in 2009 and continued to rally inside of a steep rising wedge that had a $32 target. SWKS eventually hit a high of $37.5 in February 2011. The tide then turned and SWKS started to retrace that huge move; as did its main competitor RF Micro Devices (RFMD). It broke below the rising wedge and is now down 35% from the peak with shares currently trading at $24. As you can see the market is now following suit.

This chart shows the performance of SWKS against RFMD, SOXX (iShares PHLX SOX Semiconductor Sector Index Fund), AAPL (Apple), SPY (S&P 500 ETF) and DIA (Dow Index ETF). I provided more chart analysis after the jump along with the Skyworks June 2011 presentation (embedded pdf), its growth forecast, snapshots of Q2 results (balance sheet/income statement against 2010) and recent analyst notes from Oppenheimer and Sterne Agee.

SWKS, RFMD, AAPL, SOXX, SPY, DIA (source: StockCharts.com)

Chart 1: SWKS overshot the $32 target at the apex and is now retracing the move. This is a monthly chart.

Chart 2: SWKS is in a descending channel and the 50 day moving average is about to test, or potentially cross, the 200 day moving average (dark cross) and traders could already be pricing this in. $25.50 is ceiling resistance, $23 is the recent low (support), and $17.50-$18ish look like support levels from April to August 2010. There could be a stronger relief rally to test resistance levels, but the chart looks like there's downside bias until it breaks above ceiling resistance ($25.50-26), the 50 and 200DMA and descending channel resistance.

Chart 3: SWKS's 50% retracement level is at $20.69 ($3.57 trough - $30.82 peak)


CHART 1 (source: FreeStockCharts.com)

CHART 2 (source: FreeStockCharts.com)

CHART 3 (source: StockCharts.com)

Skyworks Analyst War - Sterne Agee vs. Oppenheimer:

Skyworks Slides; Sterne Agee Downgrades To Neutral From Buy Forbes.com (June 3, 2011)

Skyworks Solutions Plunging On Downgrade ("removes price target") - Benzinga (June 3, 2011)

Oppenheimer Reports (positively) on Skyworks Solutions ($34 target still) - Benzinga (June 9, 2011)

Oppenheimer Maintains Outperform on Skyworks Solutions - Benzinga (May 27, 2011)


Skyworks Solutions Growth Outlook, Financial Data and June 2011 Presentation:
Skyworks Affirms Above Market Growth Outlook

Reiterates Strong Guidance Ahead of This Week's Investor Meetings; Outlook Excludes Recently Announced Acquisitions

WOBURN, Mass., Jun 07, 2011 (BUSINESS WIRE) -- Skyworks Solutions, Inc. (NASDAQ: SWKS), an innovator of high reliability analog and mixed signal semiconductors enabling a broad range of end markets, today announced, ahead of a non-deal road show, it is affirming its outlook for above market growth, excluding its recently announced acquisitions. In April 2011, Skyworks guided to approximately $345 million in revenue with non-GAAP diluted earnings per share of $0.46 for the current quarter. Further, during the earnings conference call, the Company indicated it was on a path to approach a $1.5 billion revenue run rate with $2.00 in annualized non-GAAP diluted earnings per share in the September quarter. This growth outlook is being driven by the Company's broad customer base, diversification into new markets and increasing share gains.

"Skyworks' core business continues to outperform our addressed markets and we believe this will be clearly reflected in our performance and guidance," said Donald W. Palette, vice president and chief financial officer of Skyworks. "To be clear, our revenue and non-GAAP earnings outlook for both the June and September quarters is before we add the accretive SiGe and Advanced Analogic Technologies acquisitions."

Source: http://phx.corporate-ir.net/phoenix.zhtml?c=131895&p=irol-newsArticle&ID=1571418&highlight=




Skyworks Overview June 2011

Source: Skyworks Solutions Company Presentation June 2011

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