Skyworks Solutions, Inc. (SWKS) has completed the all-cash acquisition of the Infrastructure & Automotive (I&A) business of Silicon Laboratories, Inc. (SLAB) valued at $2.75 billion. Shares closed marginally higher at $192.79 on July 26.
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Skyworks manufacturers analog semiconductors with a wide range of applications, including aerospace, automotive, broadband, cellular infrastructure, and entertainment, among others. (See Skyworks Solutions stock charts on TipRanks)
Silicon Laboratories’ I&A business consists of power/isolation, timing, and broadcast product lines, which are highly complementary to Skyworks’ connectivity portfolio. The combined business will potentially enhance Skyworks’ market opportunity to $20 billion annually.
Liam K. Griffin, Chairman, CEO, and President of Skyworks said, “The I&A business brings a highly diversified customer base that will enable our continued expansion into strategic end markets. Together, we will accelerate profitable growth in key industry segments, including electric and hybrid vehicles, industrial and motor control, power supply, 5G wireless infrastructure, optical data communications, and data center.”
Following the news, UBS analyst Timothy Arcuri reiterated a Hold rating on the stock, while raising the price target to $200 (3.7% upside potential) from $195.
Overall, the stock has a Moderate Buy consensus rating based on 12 Buys and 6 Holds. The average Skyworks Solutions price target of $214.94 implies 11.5% upside potential to current levels. Shares have gained 41% over the past year.
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