Balancing Dividends and Fundamentals: The Case of NASDAQ:SWKS.

Take a closer look at SKYWORKS SOLUTIONS INC (NASDAQ:SWKS), a stock of interest to dividend investors uncovered by our stock screener. NASDAQ:SWKS excels in fundamentals and provides a decent dividend, all while maintaining a reasonable valuation. Let's break it down further.

Understanding NASDAQ:SWKS's Dividend Score

ChartMill employs its own Dividend Rating system for all stocks. This score, on a scale of 0 to 10, is determined by evaluating different dividend factors, such as yield, historical performance, dividend growth, and sustainability. NASDAQ:SWKS has been assigned a 7 for dividend:

• With a Yearly Dividend Yield of 4.29%, SWKS is a good candidate for dividend investing.
• SWKS's Dividend Yield is rather good when compared to the industry average which is at 2.39. SWKS pays more dividend than 96.30% of the companies in the same industry.
• SWKS's Dividend Yield is rather good when compared to the S&P500 average which is at 2.31.
• The dividend of SWKS is nicely growing with an annual growth rate of 11.77%!
• SWKS has been paying a dividend for at least 10 years, so it has a reliable track record.
• SWKS has not decreased its dividend in the past 5 years, so it has a somewhat stable track record.

Analyzing Health Metrics

To gauge a stock's financial health, ChartMill utilizes a Health Rating on a scale of 0 to 10. This comprehensive evaluation encompasses liquidity and solvency, both in absolute terms and in comparison to industry peers. NASDAQ:SWKS has earned a 8 out of 10:

• SWKS has an Altman-Z score of 5.49. This indicates that SWKS is financially healthy and has little risk of bankruptcy at the moment.
• Looking at the Altman-Z score, with a value of 5.49, SWKS is in the better half of the industry, outperforming 65.74% of the companies in the same industry.
• SWKS has a debt to FCF ratio of 0.81. This is a very positive value and a sign of high solvency as it would only need 0.81 years to pay back of all of its debts.
• The Debt to FCF ratio of SWKS (0.81) is better than 80.56% of its industry peers.
• A Debt/Equity ratio of 0.16 indicates that SWKS is not too dependend on debt financing.
• SWKS has a Current Ratio of 5.94. This indicates that SWKS is financially healthy and has no problem in meeting its short term obligations.
• Looking at the Current ratio, with a value of 5.94, SWKS belongs to the top of the industry, outperforming 85.19% of the companies in the same industry.
• A Quick Ratio of 4.73 indicates that SWKS has no problem at all paying its short term obligations.
• With an excellent Quick ratio value of 4.73, SWKS belongs to the best of the industry, outperforming 81.48% of the companies in the same industry.

Profitability Examination for NASDAQ:SWKS

ChartMill assigns a Profitability Rating to every stock. This score ranges from 0 to 10 and evaluates the different profitability ratios and margins, both absolutely, but also relative to the industry peers. NASDAQ:SWKS scores a 6 out of 10:

• SWKS's Return On Assets of 6.32% is fine compared to the rest of the industry. SWKS outperforms 69.44% of its industry peers.
• Looking at the Return On Equity, with a value of 8.23%, SWKS is in the better half of the industry, outperforming 62.04% of the companies in the same industry.
• SWKS's Return On Invested Capital of 7.09% is fine compared to the rest of the industry. SWKS outperforms 72.22% of its industry peers.
• The last Return On Invested Capital (7.09%) for SWKS is well below the 3 year average (12.13%), which needs to be investigated, but indicates that SWKS had better years and this may not be a problem.
• SWKS has a Profit Margin of 13.02%. This is in the better half of the industry: SWKS outperforms 69.44% of its industry peers.
• The Operating Margin of SWKS (17.19%) is better than 75.00% of its industry peers.

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Our latest full fundamental report of SWKS contains the most current fundamental analsysis.

Disclaimer

Important Note: The content of this article is not intended as trading advice. It is essential to perform your own analysis and exercise caution when making trading decisions. The article presents observations created by automated analysis but does not guarantee any trading or investment outcomes. Always trade responsibly and make independent judgments.