ON Semiconductor’s Stock Struggles Despite Strong Market Position
Valued at $27.6 billion by market cap, ON Semiconductor Corporation (ON) is recognized as a leading player in the semiconductor sector. Based in Scottsdale, Arizona, it offers an extensive range of innovative products that cater to critical markets, including automotive, industrial, and communications.
Being a large-cap stock, ON Semiconductor falls into the category of companies valued over $10 billion, a testament to its strong market presence. The firm emphasizes energy efficiency and sustainable technologies, demonstrating resilience within a rapidly changing global market that increasingly relies on electric solutions.
Stock Performance Updates
ON Semiconductor shares have dropped 24.7% from their 52-week high of $86.10, reached on December 27, 2023. In the last three months alone, the stock experienced an 11.7% decline, notably lagging behind the modest gains of the broader Dow Jones Industrials Average ($DOWI) during the same period.
Yearly Insights and Moving Averages
In the past 52 weeks, ON stock has fallen 23.5%, and on a year-to-date (YTD) basis, it is down 22.4%, contrasting sharply with the Dow’s impressive YTD growth of 12.3% and a 12.7% return over the last year. The stock has shown bearish momentum, consistently trading below its 50-day and 200-day moving averages with some fluctuations.
Recent Earnings and Future Projections
ON Semiconductor saw its stock decline by over 4% on December 18, part of a broader trend affecting chip stocks. When the company reported its Q3 earnings on October 28, it led to a short-term 3.4% increase in stock value the following trading session. The adjusted EPS was $0.99, down 28% year-over-year but slightly higher than the expected $0.97. Adjusted revenue totaled $1.76 billion, a 19.2% year-over-year drop, yet slightly above Wall Street’s forecast of $1.75 billion.
The company has set its fourth-quarter 2024 guidance with revenues expected between $1.71 billion and $1.81 billion, and non-GAAP diluted earnings per share projected to be between $0.92 and $1.04.
Comparison with Competitors
In comparing performances with competitors, ON Semiconductor finds itself in a better position than STMicroelectronics N.V. (STM), which has suffered a 51.2% decline YTD and a 51.5% drop over the past year.
Despite the recent downward trend in its stock price, analysts maintain a cautiously optimistic outlook for ON Semiconductor. The stock holds a consensus “Moderate Buy” rating from 31 analysts, with a mean price target of $86.67, indicating a potential upside of 33.8% from its current value.
On the date of publication, Rashmi Kumari did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article are provided for informational purposes only. For further details, please refer to the Barchart Disclosure Policy here.
The views and opinions expressed herein are solely those of the author and do not necessarily reflect those of Nasdaq, Inc.
