Skyworks Solutions Inc (SWKS), Apple Inc. (AAPL): This Under-The-Radar Tech Stock Is Poised For A 32% Rally

The semiconductor industry has been around since the 1960s and has grown to be a nearly $300 billion global business. Basically, semiconductors control the flow of electricity by forming the basis of integrated circuits, transistors, solid-state electronics and solar cells, among many other functions. In other words, semiconductors form the base of our modern electronics-driven society.

Over the years, investors have made trillions of dollars investing in this sector. Most everyone is familiar with major semiconductor companies like Intel Corporation (NASDAQ:INTC), Micron Technology, Inc. (NASDAQ:MU) and Texas Instruments Incorporated (NASDAQ:TXN).

However, there are dozens of smaller companies that don’t have the market share of the top names, but are masters of their particular niches. My stock scanning recently discovered one of these under-the-radar semiconductor companies is setting up to be a great investment.

The company is Skyworks Solutions Inc (NASDAQ:SWKS). This Massachusetts-based semiconductor company was founded in 1962. It provides products for the GPS, broadband, cellular infrastructure, smartphone and tablet markets, among other applications. The company sells primarily to the Asia-Pacific region, with only 6% of sales in the United States.

Skyworks Solutions Inc (NASDAQ:SWKS) has a market cap of $4.65 billion, an EPS growth rate of 15% over the past three years, and a forward price-to-earnings (P/E) under 10. It beat estimates for its fiscal third quarter, ended June 28, with $436 million in revenue, up 12% from the same quarter last year. Gross margins came in at 43% with expectations of 44% to 44.5% for the next quarter. Net income was just under $66 million, which is more than 33% over the same period last year.

The company also increased its R&D spending, which is key for the future of any tech company.

What I like best about this company is its key relationships with both SAMSUNG ELECT LTD(F) (OTCMKTS:SSNLF) and Apple Inc. (NASDAQ:AAPL). Skyworks supplies chips for the iPad, iPhone and iPad Mini, as well as for Samsung’s Galaxy S4 handset.

In addition, the company is innovative and seeks to benefit from the “Internet of Things.” This next wave in technology is projected to create 50 billion connected devices by 2020. Skyworks Solutions Inc (NASDAQ:SWKS) is positioned to capitalize on this next revolution.

Taking a look at the technical picture, Skyworks Solutions Inc (NASDAQ:SWKS) is setting up to be an ideal breakout buy candidate. There is strong triple-bottom support at the $21 level, and resistance exists at $25.