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2 Radio Frequency Stocks to Watch in a Prospering Industry
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The Zacks Semiconductors - Radio Frequency industry participants like Skyworks (SWKS - Free Report) and Qorvo (QRVO - Free Report) are benefiting from the continued adoption of WiFi 6E and WiFi 7, as well as the rapid proliferation of the edge IoT, AI data centers and automotive electrification. The growing need for faster connections, low latency, and efficient battery life in wirelessly connected devices has been driving the demand for WiFi-enabled hotspots. The democratization of 5G smartphones has been a tailwind for the industry participants. Nevertheless, industry players are facing a challenging demand environment that has resulted in inventory buildup. Sluggish capital spending by telecom carriers has been a headwind. Industry participants are suffering from heightened global macroeconomic uncertainties. Weakness in end-markets like automotive, industrial and infrastructure has been concerning.
Industry Description
The Zacks Semiconductors - Radio Frequency Industry comprises companies that provide radio frequency solutions, front-end modules, low-noise amplifiers, diodes, multi-chip modules, optical components, surface acoustic wave, bulk acoustic wave technology-based antenna-plexers and film bulk acoustic resonator filters to enable smartphone devices to function more efficiently in the congested RF spectrum. They serve a wide array of industries with their solutions, finding ample applications in 5G and smartphone equipment, aerospace and defense, optical networks, cellular base stations, automotive and smart home applications. Most of these companies utilize robust wafer fabrication technologies, as well as ZigBee, Bluetooth Low Energy, Thread, silicon germanium and Gallium Nitride technologies, to stay ahead of the competition.
3 Trends Influencing the Prospects of the Semiconductors - RF Industry
Accelerated 5G Deployment Acts as a Tailwind: The rapid implementation of 5G networking infrastructure and the robust adoption of cloud computing applications look promising for the wireless communication market. The coronavirus crisis-induced work-from-home wave has necessitated the need for higher bandwidth and triggered LTE advancements, which is expected to bolster the demand for RF power amplifiers. Increasing RF content in the latest 5G smartphones is a key catalyst. The growing demand for WiFi hotspots, as the number of wirelessly connected devices increases in households, is enhancing industry prospects.
Innovation Opens up Business Avenues: The rapid proliferation of IoT, wearables, drones, VR/AR devices, autonomous cars and ADAS is expected to drive the demand for RF semiconductor products beyond smartphone devices, favoring industry prospects. RF Semiconductors are setting the pace for technology modernization by digitizing aspects like connectivity, healthcare, transport and defense. The diversified utilization of RF Semiconductor products bodes well for the industry players. The evolution of semiconductor manufacturing processes from 10 nanometers (nm) to 7 nm, and even 5 nm and 3 nm technology, is anticipated to bolster the industry prospects. The rollout of bands and band combinations has led to considerable design challenges for OEM smartphone manufacturers. Industry participants are looking to address these challenges with a robust range of antenna-plexer portfolios utilizing the BAW technology.
Growing Adoption of Electric Vehicles Aids Prospects: Industry players are gaining from the increasing inclusion of their products in electric vehicles (EVs). The market for EVs is expected to expand fourfold by 2027.
Zacks Industry Rank Indicates Bullish Near-Term Prospects
The Zacks Semiconductors - Radio Frequency Industry is housed within the broader Zacks Computer and Technology sector. It carries a Zacks Industry Rank #90, which places it in the top 37% of more than 250 Zacks industries.
The group’s Zacks Industry Rank, which is the average of the Zacks Rank of all the member stocks, indicates bullish near-term prospects. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than two to one.
The industry’s position in the top 50% of the Zacks-ranked industries is a result of a positive earnings outlook for the constituent companies in aggregate. Looking at the aggregate earnings estimate revisions, it appears that analysts are optimistic about this group’s earnings growth potential. The industry’s earnings estimates for 2025 have moved up by 2% since Feb. 28, 2025.
Given the bright prospect, there are a few stocks worth watching in the industry. However, before we present the top industry picks, it is worth looking at the industry’s shareholder returns and current valuation first.
Industry Lags S&P 500 and Sector
The Zacks Semiconductors - Radio Frequency Industry has underperformed the S&P 500 and its sector over the past year. The industry has declined 29.2% over this period against the S&P 500’s return of 12.1% and the broader sector’s appreciation of 12.7%.
One-Year Price Performance
Industry's Current Valuation
On the basis of the forward 12-month price-to-earnings ratio (P/E), which is a commonly used multiple for valuing the Semiconductors - Radio Frequency stocks, the industry is currently trading at 15.62X, lower than the S&P 500’s 21.73X and the sector’s 25.64X.
Over the past five years, the industry has traded as high as 17.64X and as low as 13.69X, the median being 15.02X, as the charts below show.
Forward 12-Month P/E Ratio
2 Radio Frequency Stocks to Watch
Skyworks: This Zacks Rank #3 (Hold) company is benefiting from positive momentum in demand signals and backlog improvement, especially in automotive electrification, edge IoT, and AI data centers. The growing adoption of Wi-Fi 6E and 7 systems further drives growth. Strong demand for RF content in real-time video, sensors and software-defined vehicles provides a boost to SWKS’ prospects. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
However, Skyworks suffers from challenging macroeconomic conditions, ongoing inventory digestion in certain end markets and tariff complexities. Shares have dropped 21.6% in the year-to-date period. The Zacks Consensus Estimate for SWKS’ fiscal 2025 earnings has increased 6.1% to $5.05 per share over the past 30 days.
Price and Consensus: SWKS
Qorvo: Shares of this Zacks Rank #3 company have moved up 9.3% year to date. The company is benefiting from the faster-than-expected transition from 4G LTE to 5G technology in emerging markets. Qorvo’s new RF Fusion front-end solutions enhance the development of advanced 4G devices, while RF Flex offers top-tier performance and flexibility for 4G designs. Growing demand for DOCSIS 4.0 hybrid power doublers is a tailwind.
However, Qorvo suffers from stiff competition. The Zacks Consensus Estimate for Qorvo’s fiscal 2026 earnings has decreased a couple of cents to $5.55 per share over the past 30 days.
Price and Consensus: QRVO
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2 Radio Frequency Stocks to Watch in a Prospering Industry
The Zacks Semiconductors - Radio Frequency industry participants like Skyworks (SWKS - Free Report) and Qorvo (QRVO - Free Report) are benefiting from the continued adoption of WiFi 6E and WiFi 7, as well as the rapid proliferation of the edge IoT, AI data centers and automotive electrification. The growing need for faster connections, low latency, and efficient battery life in wirelessly connected devices has been driving the demand for WiFi-enabled hotspots. The democratization of 5G smartphones has been a tailwind for the industry participants. Nevertheless, industry players are facing a challenging demand environment that has resulted in inventory buildup. Sluggish capital spending by telecom carriers has been a headwind. Industry participants are suffering from heightened global macroeconomic uncertainties. Weakness in end-markets like automotive, industrial and infrastructure has been concerning.
Industry Description
The Zacks Semiconductors - Radio Frequency Industry comprises companies that provide radio frequency solutions, front-end modules, low-noise amplifiers, diodes, multi-chip modules, optical components, surface acoustic wave, bulk acoustic wave technology-based antenna-plexers and film bulk acoustic resonator filters to enable smartphone devices to function more efficiently in the congested RF spectrum. They serve a wide array of industries with their solutions, finding ample applications in 5G and smartphone equipment, aerospace and defense, optical networks, cellular base stations, automotive and smart home applications. Most of these companies utilize robust wafer fabrication technologies, as well as ZigBee, Bluetooth Low Energy, Thread, silicon germanium and Gallium Nitride technologies, to stay ahead of the competition.
3 Trends Influencing the Prospects of the Semiconductors - RF Industry
Accelerated 5G Deployment Acts as a Tailwind: The rapid implementation of 5G networking infrastructure and the robust adoption of cloud computing applications look promising for the wireless communication market. The coronavirus crisis-induced work-from-home wave has necessitated the need for higher bandwidth and triggered LTE advancements, which is expected to bolster the demand for RF power amplifiers. Increasing RF content in the latest 5G smartphones is a key catalyst. The growing demand for WiFi hotspots, as the number of wirelessly connected devices increases in households, is enhancing industry prospects.
Innovation Opens up Business Avenues: The rapid proliferation of IoT, wearables, drones, VR/AR devices, autonomous cars and ADAS is expected to drive the demand for RF semiconductor products beyond smartphone devices, favoring industry prospects. RF Semiconductors are setting the pace for technology modernization by digitizing aspects like connectivity, healthcare, transport and defense. The diversified utilization of RF Semiconductor products bodes well for the industry players. The evolution of semiconductor manufacturing processes from 10 nanometers (nm) to 7 nm, and even 5 nm and 3 nm technology, is anticipated to bolster the industry prospects. The rollout of bands and band combinations has led to considerable design challenges for OEM smartphone manufacturers. Industry participants are looking to address these challenges with a robust range of antenna-plexer portfolios utilizing the BAW technology.
Growing Adoption of Electric Vehicles Aids Prospects: Industry players are gaining from the increasing inclusion of their products in electric vehicles (EVs). The market for EVs is expected to expand fourfold by 2027.
Zacks Industry Rank Indicates Bullish Near-Term Prospects
The Zacks Semiconductors - Radio Frequency Industry is housed within the broader Zacks Computer and Technology sector. It carries a Zacks Industry Rank #90, which places it in the top 37% of more than 250 Zacks industries.
The group’s Zacks Industry Rank, which is the average of the Zacks Rank of all the member stocks, indicates bullish near-term prospects. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than two to one.
The industry’s position in the top 50% of the Zacks-ranked industries is a result of a positive earnings outlook for the constituent companies in aggregate. Looking at the aggregate earnings estimate revisions, it appears that analysts are optimistic about this group’s earnings growth potential. The industry’s earnings estimates for 2025 have moved up by 2% since Feb. 28, 2025.
Given the bright prospect, there are a few stocks worth watching in the industry. However, before we present the top industry picks, it is worth looking at the industry’s shareholder returns and current valuation first.
Industry Lags S&P 500 and Sector
The Zacks Semiconductors - Radio Frequency Industry has underperformed the S&P 500 and its sector over the past year. The industry has declined 29.2% over this period against the S&P 500’s return of 12.1% and the broader sector’s appreciation of 12.7%.
One-Year Price Performance
Industry's Current Valuation
On the basis of the forward 12-month price-to-earnings ratio (P/E), which is a commonly used multiple for valuing the Semiconductors - Radio Frequency stocks, the industry is currently trading at 15.62X, lower than the S&P 500’s 21.73X and the sector’s 25.64X.
Over the past five years, the industry has traded as high as 17.64X and as low as 13.69X, the median being 15.02X, as the charts below show.
Forward 12-Month P/E Ratio
2 Radio Frequency Stocks to Watch
Skyworks: This Zacks Rank #3 (Hold) company is benefiting from positive momentum in demand signals and backlog improvement, especially in automotive electrification, edge IoT, and AI data centers. The growing adoption of Wi-Fi 6E and 7 systems further drives growth. Strong demand for RF content in real-time video, sensors and software-defined vehicles provides a boost to SWKS’ prospects. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
However, Skyworks suffers from challenging macroeconomic conditions, ongoing inventory digestion in certain end markets and tariff complexities. Shares have dropped 21.6% in the year-to-date period. The Zacks Consensus Estimate for SWKS’ fiscal 2025 earnings has increased 6.1% to $5.05 per share over the past 30 days.
Price and Consensus: SWKS
Qorvo: Shares of this Zacks Rank #3 company have moved up 9.3% year to date. The company is benefiting from the faster-than-expected transition from 4G LTE to 5G technology in emerging markets. Qorvo’s new RF Fusion front-end solutions enhance the development of advanced 4G devices, while RF Flex offers top-tier performance and flexibility for 4G designs. Growing demand for DOCSIS 4.0 hybrid power doublers is a tailwind.
However, Qorvo suffers from stiff competition. The Zacks Consensus Estimate for Qorvo’s fiscal 2026 earnings has decreased a couple of cents to $5.55 per share over the past 30 days.
Price and Consensus: QRVO
