If you have been waiting to add a 5G stock to your portfolio but haven't taken the plunge so far, now would be a good time to load up on Skyworks Solutions (SWKS -1.84%). The chipmaker has been a big winner in the rapid shift to smartphones supporting the new wireless standard.

Shares of the wireless components supplier, whose chips are used by major smartphone OEMs (original equipment manufacturers) like Apple, plunged after its fiscal 2021 Q3 results. Skyworks' drop was surprising, as the company didn't do anything wrong -- it beat estimates and delivered better-than-expected guidance.

However, the stock's post-earnings drop is an opportunity in disguise for investors waiting to jump onto the 5G bandwagon. So let's look at three reasons why you should be buying Skyworks stock.

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Skyworks Solutions is a high-growth company trading cheaply

Skyworks reported record Q3 revenue of $1.11 billion, up 52% year-over-year. Non-GAAP diluted earnings shot up 72% year-over-year to $2.15 per share. Skyworks' growth exceeded its original expectations for a 49% increase in revenue and a 70% increase in earnings per share, driven by the growing adoption of 5G technology in smartphones and other industries.

Skyworks Solutions has been delivering such impressive growth for the past year now, driven mainly by the success of its mobile business and the growing traction of its broad markets segment (which includes revenue from non-mobile products).

SWKS Revenue (TTM) Chart

SWKS Revenue (TTM) data by YCharts

But as the chart above shows, the stock has become cheaper in the past year. Skyworks stock trades at just 22 times trailing earnings despite delivering eye-popping growth. Its forward price-to-earnings (P/E) ratio is lower at 16.6, indicating that its bottom line is expected to improve in the future. For comparison, the S&P 500's P/E ratio stands at nearly 34, so Skyworks looks like a steal at its current valuation, especially considering its fast pace of growth.

Additionally, Skyworks is trading at 6.6 times sales right now, which is lower than its 2020 average price-to-sales (P/S) ratio of 7.7. It is worth noting that Skyworks is in much better shape right now than it was in the last year, and it is trading at a discount despite the pick-up in sales and earnings. As such, Skyworks Solutions is an ideal bet for investors looking to buy a growth stock at a reasonable valuation.

There's a massive opportunity ahead

Skyworks Solutions' impressive growth is based on two foundations. The first one is its relationship with the major players in the 5G smartphone market. Skyworks' mobile revenue shot up 52% year-over-year last quarter, and the trend can be expected to continue, as the chipmaker has strengthened its relationship with key OEMs. CEO Liam Griffin pointed this out on the latest earnings conference call:

In mobile, we expanded the reach of our Sky5 portfolio, powering upcoming smartphone launches at tier one manufacturers, including Google, Oppo, Vivo, Xiaomi, among others.

According to Strategy Analytics, Oppo, Vivo, and Xiaomi are among the top five smartphone vendors globally, accounting for 37.4% of smartphone sales in the second quarter. Apple, which was Skyworks' largest customer last fiscal year with 56% of total sales, occupied the second position in smartphone rankings in the second quarter with a 15.1% market share.

So Skyworks' chips are used by OEMs that sell more than half of the smartphones globally. This puts the company in a great position to take advantage of the 5G smartphone boom, which is still in its early stages. According to a third-party estimate, 5G smartphone shipments could increase at an annual rate of nearly 125% through 2025. Another estimate pegs annual 5G smartphone shipments at 1.5 billion units by 2025, compared to an estimated 269 million units last year. As such, Skyworks' mobile business is built for secular growth for the next few years.

A similar situation is unfolding in the broad markets business, which recorded 50% year-over-year growth last quarter on the back of "strong demand for IoT solutions, including WiFi 6 and 6E and smart audio, as well as emerging use cases in industrial and automotive markets."

Again, these are fast-growing connectivity niches that could ensure long-term growth for Skyworks. For instance, IDC estimates that the number of WiFi 6 device shipments could jump to 3.5 billion units in 2022, compared to 2 billion this year. By 2025, WiFi 6 device shipments could increase to 5.2 billion units annually.

All of this indicates that Skyworks can continue to deliver high growth rates for a long time to come. Analysts think the same, forecasting almost 17% annual earnings growth for the next five years, compared to the high-single-digit bottom-line growth Skyworks has clocked annually for the past five years.

The dividend is the icing on the cake

While growth-oriented investors will love Skyworks Solutions stock for its soaring sales and profits, dividend-focused investors won't feel left out either. The chipmaker recently raised its quarterly dividend payout by 12% to $0.56 per share. It now sports a forward dividend yield of 1.21%. That may not look big right now, but it is worth noting that Skyworks' dividend has doubled in the past five years.

SWKS Dividend Chart

SWKS Dividend data by YCharts

What's more, the company's dividend payout ratio has dropped over the past year on account of its rapid growth in earnings and sits at just 23.6% right now. So don't be surprised to see Skyworks further raise its dividend in the coming years, especially considering the pace at which its free cash flow is improving.

According to Skyworks CFO Kris Sennesael, "there is further room for improvement" in the dividend. One of the company's top priorities is to improve its free cash flow and use the same to increase its dividend, followed by debt reduction.

All in all, Skyworks Solutions is an all-rounder stock, which is why investors should be treating the recent pullback as a buying opportunity.