Skyworks Solutions shares jump after target raised

The stock gained 74 cents, or 8.7 percent, to $9.25. Woburn, Mass.-based Skyworks makes semiconductors for cell phones.

Oppenheimer & Co. analyst Ittai Kidron said the company's goal for 42 percent gross margins on revenue of $250 million "could be achieved within 2008, implying solid upside to current estimates."

In the fiscal second quarter ended in March, Skyworks posted gross margins of 39.8 percent on revenue of $201.7 million, and said profit jumped 37 percent to $16.7 million.

Kidron raised his price target to $11 from $9.50 and kept an "Outperform" rating. The new target implies he expects the stock to rise about 29 percent over Wednesday's $8.51 close.

For 2008, Kidron now expects earnings of 70 cents per share, compared with a previous 69 cents per share estimate. Analysts polled by Thomson Financial expect, on average, earnings of 69 cents per share for the year.

David Aldrich, Skyworks' president and chief executive, said Kidron's note shines light on the company's move to diversify its product line and its improving results.

"In some ways (the note) validates the hard work we've been putting ... into the company," Aldrich said in a phone interview.

Moving forward, Aldrich said he expects Skyworks to grow "materially faster" than the overall sector.