How can two companies that are so similar arrive at such varied results?
Second-quarter earnings jumped 71% year-over-year to $0.41 per share, sliding past the analyst target set at $0.39 per share. The revenue performance also drew heavy applause by soaring 37% and beating Street estimates by 2.7%. Resting on this foundation and looking at a densely populated order book, Skyworks raised guidance for the rest of 2011.
Like RF Micro, Skyworks is diversifying its customer base. Also like RF, Skyworks taps into the red-hot smartphone and tablet markets, and more besides. Unlike RF Micro, Skyworks isn't extracting itself from a suffocating relationship with a single, suffering customer, as RF just did with Nokia
So Skyworks keeps its factories running at full speed ahead and reaps the benefits of high utilization against fixed costs, which is good for gross margins. That's the difference-maker here, because RF Micro's factories are running on fumes without those legacy Nokia chips to tend to.
Looking ahead, Skyworks claims to be continuing to take market share despite the presence of RF Micro, TriQuint Semiconductor
Don’t forget that Skyworks shares jumped more than 14% on the news and have nearly doubled over the last year, outperforming all comers and keeping the stock's P/E ratio about twice what you see in its rivals. In other words, the stock is priced for perfection, and looks ready to take a dive on the first hint of execution problems. It happened to Cirrus Logic
Keep a wary eye on news about Skyworks if you're serious about owning the stock. The best way to do this is to add Skyworks to your Foolish watchlist, which then keeps you in touch with anything and everything that happens to the company. And it never hurts to keep your friends close and your enemies even closer: