No major fireworks out of Skyworks Solutions (
) after hours so the stock is mildly up premarket. When I bought Skyworks I mentioned the "group of 4" (
May 12, 2009: Beginning Skyworks Solutions (SWKS)
I've never owned Skyworks Solutions before but in the late 90s I traded all 3 of its major competitiors - ANAD, TQNT, RFMD.
If you ever want a laugh just pull up a 10 year chart on any of those 3 to see how "everyone was a genius" back around 1999. SWKS is more of a cylical play than what I normally prefer but it is best of breed of this group of 4, and gives me another way to have exposure to smart phones taking market share from regular cell phones; it also has some good China exposure.
Skyworks is a bit more broad in exposure than the other 3, but in the past RFMD and TQNT generally have been jockeying for "2nd place" in this group and ANAD many times bringing up the rear. TriQuint actually had a better report (vs expectation) than Skyworks last night, and RF Micro Devices (
) reports tonight. Anadigics (
) reports next week so if you are the gambling type you might jump into RFMD today if it can do anything similar to TriQuint which is up 6% premarket.
One of the big themes going forward if you look for secular growth (which is what I seek) is the next generation buildout of wireless. Basically we are going to repeat the late 1990s all over again except instead of landline its going to be via air waves. Remember, as we wrote in this piece - the United States is usually 3-5 years behind the Japanes and South Koreans... to see our future we can already look at theirs. Since we also have a few oligarchs in our telecom space (dominated by a few giants) the rollout has been very slow but eventually the technology is coming. The obvious plays are the Apples (
), Research in Motions (
) and Palms (
). But there is a whole ecosystem below them - from chips to equipment to storage. We have Starent Networks (
) as one example of vendors who should benefit.
If all goes well we can enjoy a Fed induced NASDAQ Bubble 2.0 over the coming 12-36 months, led by this group. Pets.com v2.0 might soon be at a theater near you.
I'll edit this post with earnings color from SWKS and TQNT during the morning... I am not going to chase into these stocks right now after large moves, but I am heartened to expand my watch list of candidates.
Long Skyworks Solutions, Starent Networks in fund; no personal position
