Fact based stock research
ON Semiconductor (NasdaqGS:ON)

US6821891057

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For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".

Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".

Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.

Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.

(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).

(NEW) 360° View - the ultimate rating with all financial and non-financial indicators.

ON Semiconductor stock research in summary

onsemi.com

ANALYSIS: With an Obermatt Combined Rank of 29 (worse than 71% compared with investment alternatives), ON Semiconductor (Semiconductors, USA) shares have somewhat below-average financial characteristics compared with similar stocks. Shares of ON Semiconductor are low in value (priced high) with a consolidated Value Rank of 45 (worse than 55% of alternatives) and show below-average growth (Growth Rank of 4) but are safely financed (Safety Rank of 83), which means low debt burdens. ...read more

RECOMMENDATION: A Combined Rank of 29, is a hold recommendation based on ON Semiconductor's financial characteristics. As the company ON Semiconductor's critical financial metrics exhibit below-average performance, such as low value (Obermatt Value Rank of 45) and low growth (Obermatt Growth Rank of 4), it is a somewhat questionable stock investment, where the risk of paying too much for the shares is significant, unless the company has an exceptionally bright future. In this case, good financing practices (Obermatt Safety Rank of 83) are a positive sign, because it may allow the company to weather challenging times until the hoped-for cash flows materialize. This may be true for high-tech or biotechnology companies with enough cash to sustain prolonged business development. If they own properties that only provide cash flows in the future, the stock may look excessively expensive and unattractive today. In such cases, the Obermatt Method has limited value, as it is based on facts we can observe today. If the facts lie all in the future, stock investing becomes guesswork, and this should only be a driver in a limited number of investments that account for a small fraction of a safe portfolio. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more

Latest Obermatt Ranks


360° View^new
Sentiment Rank^new
Value Rank	45
Growth Rank	4
Safety Rank	83
Combined Rank	29

Country	USA
Industry	Semiconductors
Index	Low Emissions, Employee Focus US, Human Rights, Low Waste, Recycling, NASDAQ
Size class	X-Large

19-Dec-2024. Stock data may be delayed. Log in or sign up to get the most recent research.

Further information

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Review the performance ranks of the individual metrics that form each investment strategy.

Research History: ON Semiconductor

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	30	47	43	45
GROWTH
GROWTH	66	89	33	4
SAFETY
SAFETY	23	16	62	83
SENTIMENT
SENTIMENT	n/a	76	49	^new
360° VIEW
360° VIEW	n/a	73	45	^new

Most recent update of the stock research: 19-Dec-2024. Financial reporting date used for calculating ranks: 27-Sep-2024. Stock research history is based on the Obermatt Method. The higher the rank, the better ON Semiconductor is in the corresponding investment strategy.
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Combined financial peformance in Detail

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	30	47	43	45
GROWTH
GROWTH	66	89	33	4
SAFETY
SAFETY	23	16	62	83
COMBINED
COMBINED	27	53	37	29

Last update of combined financial performance: 19-Dec-2024. Stock analysis on combined financial performance: The higher the rank of ON Semiconductor the better the performance.

Value Metrics in Detail

ANALYSIS: With an Obermatt Value Rank of 45 (worse than 55% compared with alternatives), ON Semiconductor shares are more expensive than the average comparable stock. The Value Rank is based on consolidating four value indicators, with half of the indicators below and half above average for ON Semiconductor. Price-to-Profit (also referred to as price-earnings, P/E) is 75 which means that the stock price compared with what market professionals expect for future profits is lower than for 75% of comparable companies, indicating a good value concerning ON Semiconductor's profit levels. The same is valid for Price-to-Book Capital (also referred to as market-to-book ratio) with a Price-to-Book Rank of 51, which means that the stock price is lower as regards to invested capital than for 51% of comparable investments. On the other hand, Price-to-Sales is less favorable than for 58% of alternatives (only 42% of peers have an even less favorable ratio). The same is valid for dividend yield, which is lower than for 99% of comparable companies, making the stock more expensive compared with the company's expected dividend payouts. ...read more

RECOMMENDATION: The overall picture with a consolidated Value Rank of 45, is a hold recommendation based on ON Semiconductor's stock price compared with the company's operational size and dividend yields. This is a puzzling picture, because it means that profits are high while dividends are low. Since the stock price is low compared with invested capital but high concerning expected revenues, the company has more invested capital than peers for generating the same amount of revenue. Since profits are higher, it could be a "cash cow" situation (using the classic Boston Consulting Group or BCG matrix naming convention) where the company is on a downward trend, still living from the profits of past products. As the company pays low dividends, it may harbor the opinion that a turnaround is possible, and it rather invests the cash than distribute it to shareholders through dividends, thus sealing the company's fate early. Any investment optimism should only be a buy trigger once thorough research is completed. We recommend further analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks, including the 360° View, before making an investment decision, which is especially important in this case, as the financial indicators are inconclusive. ...read more

VALUE METRICS	2021	2022	2023	2024
PRICE VS. REVENUES (P/S)
PRICE VS. REVENUES (P/S)	51	55	35	42
PRICE VS. PROFITS (P/E)
PRICE VS. PROFITS (P/E)	58	61	72	75
PRICE VS. CAPITAL (Market-to-Book)
PRICE VS. CAPITAL (Market-to-Book)	35	44	34	51
DIVIDEND YIELD
DIVIDEND YIELD	1	1	1	1
CONSOLIDATED RANK: VALUE
CONSOLIDATED RANK: VALUE	30	47	43	45

Last update of Value Rank: 19-Dec-2024. Stock analysis on value ratios: The higher the rank, the lower the value ratio of ON Semiconductor; except for dividend yield where the rank is higher, the higher the yield.

Growth Metrics in Detail

ANALYSIS: With an Obermatt Growth Rank of 4 (better than 4% compared with alternatives), ON Semiconductor shows one of the most restricted growth dynamics in its industry. There is little momentum in this company. The Growth Rank is based on consolidating four value indicators, with all four metrics below average for ON Semiconductor. Sales Growth has a rank of 8, which means that currently professionals expect the company to grow less than 92% of its competitors. The same is valid for Profit Growth, with a rank of 45, and Capital Growth with 6. In addition, Stock Returns have a below market rank of 37, which means that the stock returns have recently been below 63% of alternative investments. ...read more

RECOMMENDATION: The overall picture with a consolidated Growth Rank of 4, is a sell recommendation for growth and momentum investors. These are all bad growth momentum indicators. These are negative signals for investors interested in growth companies. Value is likely good for this company, as investors may have left this stock in the cold. If that is the case, investors should look at the company's outlook, especially Sentiment performance, because it may be a turnaround situation that could entail above-average stock returns in the future. But it remains a risky bet, as no growth signals are in the green zone yet. While momentum is a popular investment factor, the value aspect might be the more important one, in the longer term. We recommend analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks to arrive at a 360° View of the stock purchase case, especially since the growth performance is low here. ...read more

GROWTH METRICS	2021	2022	2023	2024
REVENUE GROWTH
REVENUE GROWTH	28	18	14	8
PROFIT GROWTH
PROFIT GROWTH	83	94	64	45
CAPITAL GROWTH
CAPITAL GROWTH	n/a	84	15	6
STOCK RETURNS
STOCK RETURNS	82	93	71	37
CONSOLIDATED RANK: GROWTH
CONSOLIDATED RANK: GROWTH	66	89	33	4

Last update of Growth Rank: 19-Dec-2024. Stock analysis on growth metrics: The higher the rank, the higher the growth and returns of ON Semiconductor.

Safety Metrics in Detail

ANALYSIS: With an Obermatt Safety Rank of 83 (better than 83% compared with alternatives) for 2024, the company ON Semiconductor has safe financing practices, which means that their overall debt burden is low. This doesn't mean that the business of ON Semiconductor is safe, it only means that the company is on the safer side regarding possible bankruptcy, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, with two out of three indicators above-average for ON Semiconductor. Refinancing is at 57, meaning the portion of the debt that is about to be refinanced is below average. It has less debt in the refinancing stage than 57% of its competitors. Liquidity is also good at 85, meaning the company generates more profit to service its debt than 85% of its competitors. This indicates that the company is safer when it comes to debt service. However, Leverage is rather large at 42, which means the company has an above-average debt-to-equity ratio. It has more debt than 58% of its competitors. ...read more

RECOMMENDATION: With a consolidated Safety Rank of 83 (better than 83% compared with alternatives), ON Semiconductor has a financing structure that is significantly safer than that of its competitors. This is not bad if things go well. The higher debt level means better returns to shareholders if things go well. Many top-performing companies operate with higher debt levels, and ON Semiconductor could be in that group. But if you expect the environment to turn rougher, the higher leverage could become a problem. The same is valid if you expect interest rates to rise. That could squeeze shareholder returns, which so far have benefitted from better conditions. In the long-term, investors may have a debt challenge with ON Semiconductor and should also compare Obermatt’s Value, Growth, and Sentiment Ranks before making a decision. ...read more

SAFETY METRICS	2021	2022	2023	2024
LEVERAGE
LEVERAGE	20	14	36	42
REFINANCING
REFINANCING	49	35	35	57
LIQUIDITY
LIQUIDITY	34	34	85	85
CONSOLIDATED RANK: SAFETY
CONSOLIDATED RANK: SAFETY	23	16	62	83

Last update of Safety Rank: 19-Dec-2024. Stock analysis on safety metrics: The higher the rank, the lower the leverage of ON Semiconductor and the more cash is available to service its debt.

Sentiment Metrics in Detail

SENTIMENT	2021	2022	2023	2024
ANALYST OPINIONS
ANALYST OPINIONS	n/a	55	38	^new
OPINIONS CHANGE
OPINIONS CHANGE	n/a	58	50	^new
PRO HOLDINGS
PRO HOLDINGS	n/a	94	91	^new
MARKET PULSE
MARKET PULSE	n/a	30	24	^new
CONSOLIDATED RANK: SENTIMENT
CONSOLIDATED RANK: SENTIMENT	n/a	76	49	^new

Last update of Sentiment Rank: 19-Dec-2024. Stock analysis on sentiment metrics: The higher the rank, the more positive the sentiment for ON Semiconductor.
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