Bank of America Securities analyst Vivek Arya has maintained their bearish stance on SWKS stock, giving a Sell rating on October 20.
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Vivek Arya’s rating is based on the assessment that despite the cost benefits anticipated from the merger between Skyworks Solutions (SWKS) and Qorvo (QRVO), the combined company’s growth potential remains limited. The merger is expected to create a significant player in the RF market with substantial revenue and EBITDA, but the company’s exposure to the slow-growing consumer semiconductor market poses a challenge to its topline growth prospects.
Additionally, Arya highlights concerns about the high customer concentration, particularly with Apple, and the competitive pressures from other major players like Qualcomm and Broadcom in the RF market. The potential for revenue dissynergies due to overlapping product portfolios and SWKS’s limited history with large mergers further contribute to the cautious outlook. Consequently, Arya maintains a Sell rating with a price objective of $70, reflecting these persisting risks and the limited upside potential compared to its peers.
Arya covers the Technology sector, focusing on stocks such as Nvidia, Advanced Micro Devices, and Intel. According to TipRanks, Arya has an average return of 17.1% and a 61.90% success rate on recommended stocks.
In another report released on October 20, Mizuho Securities also downgraded the stock to a Sell with a $60.00 price target.