Skyworks Solutions, Inc. (SWKS) Intrinsic Value

DCF-based fair value calculation with Bear, Base, and Bull scenarios

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Skyworks Solutions, Inc. (SWKS)

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Intrinsic Value (DCF)

Current$58.50
Intrinsic$129.19
+121%
$88.32$129.19$206.89
Market implies 1% growth for 5 years
DCF analysis suggests SWKS could have 121% upside at 8% growth — verify assumptions match your view.
At $59, the market prices in only 1% growth — below historical 8%, suggesting low expectations.
Range: Bear $88 → Bull $207. Current price implies expectations below the bear case — very conservative expectations.
Discount ↓Growth →4%6%8%10%
8%$153$167$182$198
10%$109$119$129$140
12%$85$92$100$108
14%$69$75$81$88

Bull Case

  • Bull case ($207) offers 254% upside at 10% growth, 9% discount
  • Price below even worst-case scenario — strong margin of safety
  • Market-implied growth (1%) ≤ historical CAGR (8%)

Bear Case

  • Bear case ($88) with 6% growth, 12% discount rate
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5-Year Free Cash Flow Projection

Year 1$1.19B
Year 2$1.29B
Year 3$1.39B
Year 4$1.50B
Year 5$1.62B
Terminal$23.91B

📐 Model Inputs

Growth Rate8.0%5Y CAGR (cascade: 5Y→3Y→TTM)
Discount Rate10.0%WACC estimate
Terminal Growth3.0%Perpetuity rate
Base Free Cash Flow$1.11BTTM actual
Bear g×0.8, r+2%
Base Historical CAGR
Bull g×1.2, r−1.5%
ℹ️

DCF estimates based on historical growth rates extrapolated forward. See FAQ below for full methodology.

Frequently Asked Questions

Is SWKS stock undervalued or overvalued?
🟢 UNDERVALUED

SWKS trades at $58.50 vs. our DCF-derived intrinsic value of $129.19, implying +95% upside. At a 10.0% WACC and 8.0% projected FCF growth, the market appears to be underpricing the present value of SWKS's future cash flows. The bear case ($93.51) still suggests upside, providing margin of safety.

What is SWKS's intrinsic value?

Using a 5-year DCF model: Base FCF of $1.11B, projected at 8.0% 5Y CAGR (best of revenue, EPS, or FCF growth), discounted at 10.0% WACC, with 3.0% terminal growth. Terminal value calculated via Gordon Growth Model: TV = FCF₅ × (1+g) / (WACC−g). After deducting $42M net debt and dividing by 0.16B shares: Bear $93.51 | Base $129.19 | Bull $176.90. Current price $58.50 implies +95% to base case.

How is SWKS's fair value calculated?

DCF Methodology:

① Project FCF years 1-5 using 8.0% growth derived from 5-year historical CAGR (best of revenue, EPS, or FCF growth, with 8% floor and 25% cap).

② Calculate terminal value at year 5 using perpetuity growth model with g=3.0%.

③ Discount all cash flows to PV using WACC=10.0%.

④ Sum PV of explicit period + PV of terminal value = Enterprise Value ($20.08B).

⑤ Subtract net debt, divide by shares outstanding.

Sensitivity analysis available above—adjust WACC ±2% or growth ±3% to stress-test the valuation. Implied EV/FCF multiple: 18.2x.