Sterne Agree analyst Vijay Rakesh has launched coverage of handset chip supplier Skyworks Solutions (SWKS) with a Buy rating and $20 price target.
“We believe that the quarter continues to progress well, with a healthy handset market,” he writes. “SWKS has been able to show solid execution, positive earnings power, and deleveraging on the balance sheet, some of which is reflected in the stock.” He notes that the company is a “key supplier” for the Apple iPhone 4 and the iPad with $2-$3 of content per device. He contends that “solid builds at Apple” will be a tailwind for SWKS in the 2010 second half.
SWKS is up 36 cents, or 2.1%, to $17.37.
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