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Why I Invested Over $100,000 in SWKS

Why I Invested Over $100,000 in SWKS

What is Skyworks Solutions?

Skyworks Solutions, Inc. (SWKS) designs, develops, manufactures, and markets proprietary semiconductor products, including intellectual property worldwide. Its product portfolio includes amplifiers, attenuators, circulators/isolators, DC/DC converters, demodulators, detectors, diodes, directional couplers, diversity receive modules, filters, front-end modules, hybrids, LED drivers, low noise amplifiers, mixers, modulators, optocouplers/optoisolators, phase shifters, phase locked loops, power dividers/combiners, receivers, switches, synthesizers, technical ceramics, voltage controlled oscillators/synthesizers, and voltage regulators. The company provides its products for automotive, broadband, cellular infrastructure, connected home, industrial, medical, military, smartphone, tablet, and wearable applications. Skyworks Solutions, Inc. sells its products through direct sales force, electronic component distributors, and independent sales representatives. The company was founded in 1962 and is headquartered in Woburn, Massachusetts.

What does this mean in english? SWKS is a technology company on the cutting edge which designs a variety of popular parts for electronic devices, chips that go in popular smartphones (40% of its revenues come from Apple; as a key supplier of parts for the last several iPhones), and integrated parts for the Internet of Things including parts for smart electronics in automobiles.

Skyworks Solutions, Inc. Fundamental and Technical Analysis

Skyworks is trading at the time of this publication at $105/share in after hours trade. According to investors.com the stock is #10 in its category at this time, and is presently working on a technical chart formation known as a cup with handle with a $117.75 buy point (meaning if it hits $117.75 on volume 40% higher than normal, it could be a good time to buy). Overall, the companies fundamentals look good. SWKS had net income of over $1 billion dollars last year and has over $4.5 billion in assets with very little liabilities in comparison $500 million, and has over $1.6 billion worth of cash on hand. Skyworks has considered merging with another company within the last few years (as a strategic partner. The merger fell through but SWKS still has tremendous cash on hand to buy another company should a good opportunity present itself. The company is very financially healthy and has increased its dividend slightly over the last few years. Skyworks is a growth stock with high potential in a high growth industry.

My Beliefs About the Potential for Skyworks Solutions Inc. and the Growth of the Internet of Things

For those who believe in the Internet of Things and the tremendous potential for growth you may believe like i do that SWKS is a good investment. Skyworks has continually come out with new and innovative products, has increased its content in the latest iPhone and seems to have developed and is working hard to maintain its competitive advantages in supplying Apple. However, some believe that it is a bad thing that 40% of its revenue comes from Apple and until it is able to derive less of its revenue from Apple and more from other companies (to avoid being so heavily dependent upon Apple, which could potentially replace it with another supplier, thus drastically reducing SWKS’s revenue overnight). Skyworks was trading in the $25-$35 range in the last few years, and has gone up significantly, previously hitting around $113 or so before dipping all the way back down to $60 or so in mid 2016. It has now risen again to as high as $115/share recently and is presently trading at $105/share (although to be fair the DOW dropped over 700 points today, based on comments of a possible trade war developing). yesterday the stock was in the $108-$109 range.

My Beliefs About SWKS

As you can see from the above, Skyworks has all the makings of a winner, financially sound, great products, high growth market, strategic partnerships with an excellent company (Apple). You can also see that it has some risks and has made significant up and down moves over the last few years and could certainly do so again. So why invest over $100,000 in SWKS? Because I believe in the company. i believe in its products, and it is a financially sound company with a large cash position, its products are being put in the best products (iPhones for one), and some of the technology which it develops for motor vehicles for instance is not yet mainstream, but i believe it certainly will be within the next 5 years or so, leaving SWKS in a great position to continue to capitalize on the growth in these sectors.

Where could SWKS go from here? it could go up significantly. Analysts were previously estimated $120/share or more. I have my sights set much higher for this one. I believe it will hit much closer to $200/share within a few years. This is due to my belief they will continue to grow earnings and may continue to buy back stock from the open market as well/reducing the number of open shares on the market, which will increase the value of my shares.

Are there better places to invest this $100,000? Should I diversify more broadly? The answer to both is quite possibly yes. However, this is the path I have chosen and will continue to follow for at least the next couple of years (unless something drastic changes with Skyworks, then I may reconsider). if things go well, my investment could double or more. If things go poorly my investment could get cut in half. Only time will tell, but I like the chances with this one.

Conclusion:

Skyworks Solutions Inc. is a good overall investment from a fundamental analysis standpoint, and should it hit $117.75 it was also be excellent from a technical analysis standpoint. i will leave the money invested and see how it performs over the next year or two, unless something significant should change. The company appears well positioned to capitalize in what i personally believe is an industry that will continue to grow and develop. I believe that SWKS has a very strategic partnership with Apple and in spite of the risk of Apple cutting back from them, they have continued to gain more content in newer, more popular phones and I believe will continue to do so. Skyworks is well positioned to increase in value in my opinion.

 

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How Much Do We Need to Retire?

How Much Do I Need to Retire?

When it comes to retirement planning, one of the most common questions for couples is: How Much Do We Need to Retire?

While this answer will vary for everyone based upon their individual circumstances and how much they need to spend on an annual basis in retirement. The typical retired worker will spend $828,000. Adults 65 and over spend roughly $46,000 annually, according to the Bureau of Labor Statistics, and the average length of retirement in the U.S. is 18 years. Multiply $46,000 by 18, and you’re looking at a $828,000.

 

 

Generally, the rule is that you should set aside 15% of your paycheck for retirement savings, and the sooner the better. If you do so at an early age, you can hit the $1million dollar mark or more. For those who are extremely committed to living well in retirement or retiring early, they can even beat that by focusing on pumping as much as possible into tax favored retirement accounts at an early age and investing for passive income. Sadly however, statistics show that many do not take such an active interest or place a priority on retirement savings and the majority fall far short of what would be required to meet the $828,000 retirement of the average retiree.

 

Don’t be a statistic, start planning for retirement early and don’t underestimate the importance of pumping money into tax favored retirement accounts, getting an employer match (where offered), and placing an emphasis on your retirement investments from a young age. Smart Couples plan together for a successful financial life and a successful retirement.

Feel free to use the retirement calculators on our site to get an idea of what you will need to retire so that you can start planning.

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Best Mutual Fund 2017 T. Rowe Price – Domestic

What is Compound Interest?

T. Rowe price is a name that has become synonymous with mutual funds and investing. T. Rowe Price is one of my favorite mutual fund companies as it offers a wide array of no-load funds, both domestic and international allowing for plenty of options for the enthusiastic mutual fund investor. One of the top performing funds for 2017 is listed below along with a brief overview of the fund.

T. Rowe Price Blue Chip Growth Fund (TRBCX)

  • Current NAV as of 03/16/2018 $107.81
  • NAV Change -$0.12
  • Daily YTD Return as of 03/16/2018 11.94%
  • NAV 12 Month Low-High $78.82 – $108.71
  • Net Assets as of 02/28/2018 $51,200.29 Million

The Fees and Expenses are detailed below:

  • Gross Expense Ratio^
    0.72%
  • Net Expense Ratio^
    0.72%
  • Waiver Type
    N/A
  • Limitation Expires
    N/A
  • Transaction Fee No
  • Redemption Fee 0%
  • 12b-1 Fee 0%

In order to open an account and purchase this mutual fund one may do so with $1,000 through an IRA retirement account, or in a taxable account with a minimum of $2,500. Additionally, if one wants to set up automatic investments or systematic purchases of this fund, one may do so with a minimum recurring purchase of at least $100 (monthly/quarterly, etc.).

This is a moderately risky fund. The fund offers long-term capital appreciation by investing in leading companies in industries T. Rowe Price believes are poised for long-term growth. It gives investors a low-cost way to invest in “blue chip” companies that enjoy strong market positions, seasoned management teams, solid financial conditions, and above-average earnings growth and profitability.

Because growth stocks have higher valuations and lower dividend yields than slower-growth or cyclical companies, the share price volatility may be higher. As such, fund prices could decline further in market downturns than non-growth-oriented funds.

The 10 year historical performance for this fund was 12.92% for the month ending 2/28/18. In my opinion, this is a good fund to own long term, and a great company. The fund’s overall performance for an extended period (10 years) has been excellent, and the fund offers no front load fees and no back load fees with an ongoing management fee as listed above. I personally like T. Rowe Price and the funds they offer.

Mutual funds, in my opinion are a great investment for the long term to build wealth over time. My preference would be to always own them in tax preferred retirement accounts such as 401k’s, SEP IRA’s, IRA’s, Roth IRA’s, etc. If you have been savvy enough and are fortunate enough to have maxed out those accounts, then I would also argue these are a great long term investment for taxable brokerage accounts. I again must emphasize not to overlook the value of growing your wealth inside of tax preferred retirement accounts and the large difference this can have on your net worth over time. I am working on growing my wealth at this time as well and have most investments inside of tax preferred accounts for this exact reason, the compound growth is tax free until withdrawal and thus there is more money invested on an ongoing basis and every year which can accumulate more interest and grow. This is a humongous benefit, compound interest growth is no joke!

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Top Stock Today CVTI

Covenant Transportation Group, Inc. (CVTI) Was up Nearly 20% Today

Covenant Transportation Group, Inc., provides trucking transportation services primarily in the United States. It offers long haul, dedicated, temperature-controlled, and regional solo-driver services; long haul, regional, dedicated, and intermodal temperature-controlled services; and regional solo-driver and dedicated services. The company also provides ancillary services, including freight brokerage services and accounts receivable factoring. It serves transportation companies, such as freight forwarders, less-than-truckload carriers, and third-party logistics providers; and traditional truckload customers, including manufacturers, retailers, and food and beverage shippers.

Covenant announced that first quarter profits were expected to be in the range of 17 to 23 cents, higher than expected. This caused the stock to race higher to an intraday high of $32.36, ending the day up almost 20% and up

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