ON Semiconductor Corporation (NASDAQ: $ON) is an American semiconductor supply company headquartered in Scottsdale, Arizona. In the 2022 Fortune 500 rankings, it held the 483rd position based on its 2021 sales.
ON Semiconductor provides a range of products, including power and signal management, logic, discrete components, and custom devices, catering to diverse sectors such as automotive, communications, computing, consumer electronics, industrial applications, LED lighting, medical technology, military/aerospace, and power applications.
The company operates a network of manufacturing facilities, sales offices, and design centers across North America, Europe, and the Asia-Pacific regions.
In 2016, ON Semiconductor achieved revenues of $3.907 billion, securing its place among the top 20 semiconductor sales leaders globally.
What is the Price Target for On Semi?
The mean price projection for ON Semiconductor stands at $118.55, as derived from the 12-month price targets of 22 Wall Street analysts, all issued within the last three months.
Is ON Semiconductor a Good Investment?
Over the past year, 27 equity research analysts on Wall Street have provided ratings for ON Semiconductor, including “buy,” “hold,” and “sell” assessments. Presently, the stock has garnered 12 “hold” ratings and 15 “buy” ratings.
The collective consensus among these Wall Street analysts suggests that investors should consider a “moderate buy” stance on ON Semiconductor shares.
Shares of ON Semiconductor fall 21% as fourth-quarter guidance disappoints Wall Street
ON Semiconductor’s shares took a substantial hit on Monday, declining by over 21%, following the release of their third-quarter report. While the report exceeded expectations, the company’s less-than-rosy guidance for the remainder of the year cast a shadow.
ON Semiconductor projected fourth-quarter earnings in the range of $1.13 to $1.27 per share, excluding specific items, falling short of the $1.36 anticipated by analysts. Likewise, revenue is expected to fall between $1.95 billion and $2.05 billion, whereas Wall Street had anticipated $2.18 billion.
Deutsche Bank analysts interpreted ON Semiconductor’s guidance as a sign that the company has “finally succumbed to macro pressures,” such as a weakening demand for automobiles.
In a note on Monday, they expressed understanding of the subsequent stock drop, as investors are likely wary of ON Semiconductor returning to its cyclical patterns of the past.
However, they maintained their buy rating on the stock, believing that the company’s structural improvements will lead to better outcomes compared to previous cycles.
Craig-Hallum analysts voiced concerns that dwindling demand for electric vehicles will have an adverse impact on ON Semiconductor in the near term. They foresee a “tougher year” for the company and advise investors to exercise caution.
They highlighted ongoing uncertainties in the auto sector, including the recent UAW strike, higher interest rates, and reduced demand for EVs, which are likely to exert a negative influence over the next several quarters, potentially extending into much of 2024.
Wolfe Research analysts pointed out that ON Semiconductor had thus far managed to weather challenges due to its noncancelable orders, extended lead times, and strength in the automotive sector. However, they noted that enduring market challenges would make it “difficult to continue” this trend.
Truist Securities Maintains ON Semiconductor (ON) Buy Recommendation
According to Fintel’s report on October 31, 2023, Truist Securities has reaffirmed its coverage of ON Semiconductor (NASDAQ: ON) with a Buy recommendation.
As of the same date, the average one-year price target for ON Semiconductor stands at $91.59, with forecasts ranging from a low of $60.60 to a high of $131.25. This average price target indicates a potential increase of 40.17% from the most recent closing price of $65.34.
ON Semiconductor is expected to generate annual revenue of $8,288 million, marking a slight decrease of 0.61%. Additionally, the projected annual non-GAAP EPS is estimated to be $4.66.
What is the Fund Sentiment?
Currently, 1,885 funds or institutions have disclosed their positions in ON Semiconductor. This represents an upturn of 85 owners or a 4.72% rise in the past quarter. The mean portfolio allocation for all funds committed to ON stands at 0.46%, marking a 7.43% increase.
Over the last three months, the total institutional holdings have decreased by 4.57% to reach 475,492,000 shares.
In the realm of ON Semiconductor Corp., the put/call ratio is 1.07, signifying a pessimistic perspective on the stock.
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