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I Went Long Skyworks, Now What?


I've been passively following Skyworks for the last two years while remaining on the sidelines.

With the most recent downturn, I could no longer hold off from going long and saw the huge dip as a buffer to my investment.

With the stock returning to more solid fundamental ground (read: a 25% appreciation), what am I looking for long-term?

Over the last two or so years I have been passively keeping track of Skyworks (NASDAQ:SWKS). It was actually my uncle - the same uncle that co-authored my initial portfolio - that brought Skyworks to my attention. He was reviewing the returns he

was seeing on his shares with me toward the beginning of 2015. The stock had just closed near $100.

I thought it was great he had seen those kinds of returns. I was wishing I had something to add to the conversation at the time as I wanted to be a part of Skyworks' success and take part in investing in it. I concluded, however, then was not the time as the run-up had looked to be vertical and gotten ahead of itself.

I'm glad I stuck with my conviction - I could be down 40% today.

Instead I'm up 25% as that conviction led me to my entry into the stock just a few weeks ago when it dipped - again - below $60 a share. I saw the selloff as over blown and believed it was a price I may not see again for some time, if at all. So after due diligence - both passive (over the last year) and active (more recently) - which included pouring over balance sheets, filings and market landscape, I solidified my decision to go long and executed at $59.61.

Since buying at the beginning of July, I've seen the stock rise, fall a little, rise some more, fall a lot after earnings, and subsequently rise to the highest it has been since I've owned it. By being patient these nearly two years it has allowed me to capitalize on a company which has fallen on difficult times.

I would go so far as to equate it to my opportunity with Cummins (NYSE:CMI) earlier this year. I saw CMI fall dramatically, to levels not seen in years, only for it to recover within months to within 20% of all-time highs. There's just one difference between these two scenarios: I didn't capitalize with Cummins. Instead I used it as a learning experience and told myself I would not let this opportunity with Skyworks pass me by.

So here I am.

And this is great and all but I don't plan on holding till I realize 30% gains only to cut ties. I see Skyworks coming back to its former glory days - which really was only last year - to exceed previous highs. Of course this means there needs to be some things I'm looking for in their future. This also means I plan on holding for years and not weeks or months.

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