$69.20
arrow_drop_up1.06%Is ON a Buy or Sell based on AI Analysis?
Fundamental Analysis
ON Semiconductor Corp has a strong return on equity of 31.21%, indicating the company's ability to generate profit from shareholders' equity. With a net margin of 26.46%, ON Semiconductor Corp shows efficient cost management and profitability. The company also has a healthy current ratio of 2.71, indicating its ability to cover short-term liabilities with its current assets. Additionally, the company's low debt-to-equity ratio of 0.46 signifies a conservative approach to financing and a lower risk of financial distress. Furthermore, ON Semiconductor Corp's gross margin of 47.06% reflects the company's ability to efficiently produce goods at a profit. Moreover, ON Semiconductor Corp's revenue growth and earnings growth have been steadily positive, with an average sales growth of 11.33% and earnings growth averaging 51.54% over the past three years, respectively. The company's strong operating margin of 30.71% demonstrates efficient cost management and profitability at the operational level. Additionally, ON Semiconductor Corp's free cash flow margin of 4.87% showcases the company's ability to generate cash after accounting for operating expenses and capital expenditures. Overall, the company's solid financial performance and prudent financial management suggest a strong foundation for future growth and stability.
Positive Development
ON Semiconductor's stock price has increased from 77.47 to 81.14, showing a positive trend. The company's announcement of 7th Gen IGBT-based Intelligent Power Modules has shown its innovation and potential to reduce energy consumption in heating and cooling, which could be a positive signal for the company's growth. ON Semiconductor is attracting investor attention, as indicated by recent Zacks.com user activity, which could lead to increased investor interest and potential price growth.
Negative Development
The company's asset turnover ratio is low at 0.6451, which suggests that it might not be utilizing its assets efficiently. The company's current ratio is 2.7076, which is relatively low, indicating that it might have difficulty meeting its short-term obligations. The company's long-term debt to total capital and total equity ratios are relatively high at 0.3015 and 0.1127 respectively, which suggests that it could be over-leveraged and potentially vulnerable to market downturns.
Technical Analysis
ON Semiconductor Corp (ON) currently has a neutral technical rating, with one buy indicator (ATR), five hold indicators (RSI, MACD, CCI, ADX, and WILLR), and two sell indicators (ROC and STOCHRSI) for the month of March 2024. The stock has a beta of 1.81, indicating a higher volatility compared to the overall market. The company's stock sector is Technology, with a sector score of 84, suggesting a strong performance relative to its industry peers. ON Semiconductor Corp has a trailing PE ratio of 16.59 and a forward annual dividend yield of 0%, indicating that the company does not currently pay dividends. In terms of technical analysis, ON Semiconductor Corp's stock price has shown a 3.96% increase in the past seven days, reflecting positive short-term momentum. The stock's fifty-two-week high is $111.35 and its low is $61.47, with a market value of $34.14B. The company operates in the Technology sector, which has experienced a 28.55% change in the past year. ON Semiconductor Corp has a technical score of 83, suggesting moderate to strong technical performance. Investors may want to closely monitor the stock's technical indicators and overall market conditions to make informed investment decisions.
Conclusion and recommendation
Based on the data provided, ON Semiconductor Corp (ON) appears to be a fundamentally sound company in the technology sector. With a strong balance sheet showing significant assets, low debt levels, and positive free cash flow, the company is well-positioned for growth and stability in the long run. Furthermore, ON Semiconductor Corp has shown impressive profitability metrics, with healthy margins and returns on assets and equity. The company's technical ratings indicate a neutral stance, suggesting that investors may want to carefully assess market conditions before making investment decisions. Additionally, the analyst forecast price change of 9.19% and the average operating profit margin growth of 33.1% are positive signals for the company's future performance. In conclusion, investors looking for a potential long-term investment opportunity in the technology sector should consider ON Semiconductor Corp. The company's strong financial position, profitable operations, and positive growth forecasts make it an attractive option for those seeking stability and potential returns. However, it is important to note that market conditions and industry trends can impact stock performance, so investors should conduct thorough research and due diligence before making any investment decisions. Overall, ON Semiconductor Corp appears to be a promising investment opportunity with the potential for sustainable growth in the future.