Why SKYWORKS SOLUTIONS INC (NASDAQ:SWKS) is a Top Pick for Dividend Investors.

SKYWORKS SOLUTIONS INC (NASDAQ:SWKS) was identified as a stock worth exploring by dividend investors by our stock screener. SWKS scores well on profitability, solvency and liquidity. At the same time it seems to pay a decent dividend. We'll explore this a bit deeper below.

Understanding SWKS's Dividend Score

ChartMill assigns a Dividend Rating to each stock, ranging from 0 to 10. This rating is calculated by analyzing various dividend elements, such as yield, historical performance, dividend growth, and sustainability. SWKS has been awarded a 7 for its dividend quality:

• With a Yearly Dividend Yield of 5.00%, SWKS is a good candidate for dividend investing.
• Compared to an average industry Dividend Yield of 2.98, SWKS pays a better dividend. On top of this SWKS pays more dividend than 96.33% of the companies listed in the same industry.
• SWKS's Dividend Yield is rather good when compared to the S&P500 average which is at 2.51.
• 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.
• As SWKS did not decrease their dividend in the past 5 years, we can say the dividend looks stable.

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. SWKS has earned a 8 out of 10:

• SWKS has an Altman-Z score of 4.95. This indicates that SWKS is financially healthy and has little risk of bankruptcy at the moment.
• SWKS has a better Altman-Z score (4.95) than 65.14% of its industry peers.
• The Debt to FCF ratio of SWKS is 0.81, which is an excellent value as it means it would take SWKS, only 0.81 years of fcf income to pay off all of its debts.
• SWKS's Debt to FCF ratio of 0.81 is amongst the best of the industry. SWKS outperforms 80.73% of its industry peers.
• A Debt/Equity ratio of 0.16 indicates that SWKS is not too dependend on debt financing.
• A Current Ratio of 5.94 indicates that SWKS has no problem at all paying its short term obligations.
• The Current ratio of SWKS (5.94) is better than 85.32% of its industry peers.
• A Quick Ratio of 4.73 indicates that SWKS has no problem at all paying its short term obligations.
• SWKS's Quick ratio of 4.73 is amongst the best of the industry. SWKS outperforms 83.49% of its industry peers.

Looking at the Profitability

ChartMill utilizes a Profitability Rating to assess stocks, scoring them on a scale of 0 to 10. This rating takes into account a variety of profitability ratios and margins, both in absolute terms and in comparison to industry peers. SWKS has earned a 6 out of 10:

• SWKS has a Return On Assets of 6.32%. This is in the better half of the industry: SWKS outperforms 68.81% of its industry peers.
• SWKS has a better Return On Equity (8.23%) than 62.39% of its industry peers.
• SWKS has a Return On Invested Capital of 7.09%. This is in the better half of the industry: SWKS outperforms 73.39% of its industry peers.
• The 3 year average ROIC (12.13%) for SWKS is well above the current ROIC(7.09%). The reason for the recent decline needs to be investigated.
• Looking at the Profit Margin, with a value of 13.02%, SWKS is in the better half of the industry, outperforming 67.89% of the companies in the same industry.
• SWKS has a Operating Margin of 17.19%. This is in the better half of the industry: SWKS outperforms 75.23% of its industry peers.

More Best Dividend stocks can be found in our Best Dividend screener.

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

Keep in mind

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.