ON Stock Risk & Deep Value Analysis
ON Semiconductor Corp
Technology • Semiconductors
DVR Score
out of 10
What You Need to Know About ON Stock
We analyzed ON Semiconductor Corp using our deep value framework. Sign in to see our full verdict and DVR Score.
We ran ON through our deep value framework — analyzing financial health, distress signals, competitive moat, and risk factors. Our risk assessment: Moderate. Here's what we found.
ON Risk Analysis & Red Flags
What Could Go Wrong
Continued revenue decline and persistent low net margins would signal a failure of the strategic pivot to translate into profitable growth, leading to further multiple contraction and significant share price depreciation. The significant insider selling indicates a lack of conviction from leadership, which could exacerbate investor caution.
Risk Matrix
Overall
Moderate
Financial
Medium
Market
Medium
Competitive
Medium
Execution
Medium
Regulatory
Low
Red Flags
- ⚠
11.2% YoY revenue decline in Q4 2025
- ⚠
Very thin 2% net margin in Q4 2025
- ⚠
Significant insider selling by CEO ($1.46M) and Group President ($358K) in past 90 days
- ⚠
Analyst median price target ($56.75) implies downside from current price ($68.67)
- ⚠
Trailing P/E of 47.39 appears high given current declining revenue and low profitability
Upcoming Risk Events
- 📅
Further slowdown in EV demand impacting SiC orders
- 📅
Increased competitive pressure from other SiC manufacturers
- 📅
Broader semiconductor market downturn
When to Reconsider
- 🚪
Quarterly revenue continues to decline by double digits YoY
- 🚪
Net margin falls below 1% for two consecutive quarters
- 🚪
Further significant insider selling by executive leadership
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What Does ON Semiconductor Corp (ON) Do?
Market Cap
$20.74B
Sector
Technology
Industry
Semiconductors
Employees
26,400
ON Semiconductor Corporation provides intelligent sensing and power solutions in Hong Kong, Singapore, the United Kingdom, the United States, and internationally. The company operates through three segments Power Solutions Group, Analog and Mixed-Signal Group, and Intelligent Sensing Group. The Power Solutions Group segment offers discrete, module and integrated semiconductor products that perform multiple application functions, including power switching, signal conditioning, and circuit protection. The Analog and Mixed-Signal Group segment designs and develops analogues, mixed-signal, power management ICs, sensor interface devices, power conversion, signal chain, and voltage regulation devices for end-users in the automotive, industrial, computing and mobile end-markets. The Intelligent Sensing Group segment designs and develops complementary metal oxide semiconductor image sensors, image signal processors, single photon detectors, including silicon photomultipliers, single photon avalanche diode arrays, and short-wavelength infrared products, as well as actuator drivers for autofocus and image stabilization for a broad base of end-users in the different end-markets. ON Semiconductor Corporation was incorporated in 1992 and is headquartered in Scottsdale, Arizona.
Visit ON Semiconductor Corp WebsiteInvestment Thesis
ON Semiconductor is undergoing a significant strategic pivot towards high-growth, high-margin intelligent power and sensing solutions, particularly in Silicon Carbide (SiC) for electric vehicles and industrial applications. While recent Q4 2025 earnings showed revenue decline and thin margins, the long-term secular trends in these markets, coupled with ON's vertical integration and strategic partnerships, could eventually lead to market leadership and a re-rating. The $6B share buyback program indicates management's confidence in long-term value creation despite current headwinds.
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ON Price Targets & Strategy
12-Month Target
$60.00
Bull Case
$75.00
Bear Case
$45.00
Valuation Basis
Based on 10.8x P/CF applied to TTM Operating Cash Flow per share of $5.54 (TTM OCF / share = $5.54 * 1.08 = $6.00 and 10x P/CF = $60.00)
Entry Strategy
Dollar-cost average on dips towards $55-$60, testing previous support levels, as current price is above analyst consensus target.
Exit Strategy
Consider profit-taking if price approaches $75, or re-evaluate if Q1 2026 earnings show further revenue decline or margin compression below the $50 level.
Portfolio Allocation
3% for moderate risk tolerance
Price Targets & Strategy
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Is ON Financially Healthy?
Valuation
P/E Ratio
47.39
Forward P/E
19.50
PEG Ratio
2.52
Price/Book
2.45
Price/Sales
3.30
Profitability
Net Margin
7.28%
Return on Equity
15.33%
EPS
$1.07
Balance Sheet
Current Ratio
5.02
Quick Ratio
3.37
Debt/Equity
0.42
Cash Flow
EBITDA
$1.43B
Other
Beta (Volatility)
2.05
Does ON Have a Competitive Moat?
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🛡️ Narrow
Moat Trend
Stable, with potential for expansion if SiC leadership materializes and competitors do not rapidly catch up. However, immediate market headwinds could slow this expansion.
Moat Sources
3 Identified
The moat is durable due to the high capital intensity and technical complexity of SiC manufacturing and the rigorous qualification processes required by key customers. However, it is not unassailable, as strong competitors are also heavily investing in SiC.
Moat Erosion Risks
- •Faster technological advancements or cost reductions by competitors (e.g., Wolfspeed, STMicroelectronics, Infineon)
- •Failure to scale SiC production efficiently or secure sufficient long-term supply agreements
- •Commoditization of certain power semiconductor components
ON Competitive Moat Analysis
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ON Market Intelligence
Sentiment & Insider Activity
Social Sentiment
Neutral, as no specific data is provided but recent financial results and insider selling likely temper enthusiasm.
Institutional Sentiment
Neutral to Negative. While institutional ownership is high (97.70%), the consensus 'Hold' rating and median price target below current value suggest a cautious outlook, implying institutions are holding existing positions rather than actively buying for significant upside.
Insider Activity (Form 4)
CEO Hassane El-Khoury sold 20,000 shares ($1,460,400) on Feb 12, 2026. Group President Sudhir Gopalswamy sold 6,114 shares ($358,708) on Mar 13, 2026. No insider buying recorded in the last 90 days, indicating net selling pressure.
Options Flow
Normal options activity, as no specific unusual options flow data was provided.
Earnings Intelligence
Next Earnings
Estimated early May 2026 (for Q1 2026)
Surprise Probability
Medium
Historical Earnings Pattern
Historical pattern not explicitly provided; however, given recent revenue decline, Q1 results will likely see a volatile reaction depending on guidance and SiC performance.
Key Metrics to Watch
Competitive Position
Top Competitor
Infineon Technologies AG (IFX)
Market Share Trend
Stable overall, but aiming to gain market share in the SiC segment, though overall revenue decline suggests some softness in other areas or insufficient SiC growth to offset.
Valuation vs Peers
Trading at a premium on P/E (47.39) compared to what might be expected for a company with declining revenue and thin margins, suggesting the market is still pricing in significant future growth that has not yet materialized.
Competitive Advantages
- •Vertically integrated Silicon Carbide (SiC) manufacturing
- •Strategic OEM partnerships in automotive and industrial sectors
- •Established brand and customer relationships built over decades
Market Intelligence
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What Could Drive ON Stock Higher?
Near-Term (0-6 months)
- •Q1 2026 Earnings Report (Estimated early May 2026)
- •New Silicon Carbide (SiC) design wins announcements
Medium-Term (6-18 months)
- •Expansion of SiC manufacturing capacity to meet demand
- •Formation of new strategic partnerships with EV or industrial OEMs
Long-Term (18+ months)
- •Achievement of market leadership in specific EV and industrial power/sensing segments
- •Broader adoption of intelligent power solutions across industries
Catalysts & Growth Drivers
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What's the Bull Case for ON?
- ✓
Consistent return to positive revenue growth (especially in SiC segment)
- ✓
Significant expansion of gross and net profit margins
- ✓
Increased insider buying activity from executives
Bull Case Analysis
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Competing with ON
See how ON Semiconductor Corp compares to related companies
| Company | Market Cap | DVR Score | P/E | Revenue | Profit Margin | Rev Growth | |
|---|---|---|---|---|---|---|---|
ON Semiconductor Corp ON | $20.7B | 5.3 | 47.4 | $7.1B | 7.3% | 0.0% | |
Wolfspeed Inc WOLF | $1.4B | 7.9 | -1.3 | $757.6M | -91.6% | -3.7% | Compare → |
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How ON Semiconductor Corp Makes Money
ON Semiconductor designs, manufactures, and markets a diverse portfolio of semiconductor products focused on intelligent power and sensing technologies. The company primarily serves the automotive (especially electric vehicles), industrial, communications, consumer, and medical markets by providing chips that optimize power efficiency and enable advanced sensing capabilities. It is strategically shifting its product mix towards higher-value, higher-growth solutions like Silicon Carbide (SiC) power devices and advanced analog integrated circuits, aiming to become a leader in these mission-critical segments.
Read Full Business Model BreakdownFAQ
What is the DVR Score for ON Semiconductor Corp (ON)?
As of April 11, 2026, ON Semiconductor Corp has a DVR Score of 5.3 out of 10, placing it in the "Proceed with Caution" category. This score is generated by our AI-powered deep value analysis framework that evaluates growth potential, financial health, competitive moat, and risk factors.
What is the market capitalization of ON Semiconductor Corp?
ON Semiconductor Corp's market capitalization is approximately $20.7B. The company operates in the Technology sector within the Semiconductors industry.
What ticker symbol does ON Semiconductor Corp use?
ON is the ticker symbol for ON Semiconductor Corp. The company trades on the NMS.
What is the risk level for ON stock?
Our analysis rates ON Semiconductor Corp's overall risk as Moderate. This assessment considers execution risk, market risk, financial risk, competitive risk, and regulatory risk. For a full breakdown, see the risk analysis section above.
What is the P/E ratio of ON?
ON Semiconductor Corp currently has a price-to-earnings (P/E) ratio of 47.4. This is above the market average, suggesting the stock may be priced for high growth expectations.
Is ON Semiconductor Corp's revenue growing?
ON Semiconductor Corp has reported revenue growth of 0.0%. Revenue has been declining, which warrants closer examination.
Is ON stock profitable?
ON Semiconductor Corp has a profit margin of 7.3%. The company is profitable but margins are modest.
How often is the ON DVR analysis updated?
Our AI-powered analysis of ON Semiconductor Corp is refreshed regularly to incorporate the latest financial data, market conditions, and news. The most recent update was on April 11, 2026.
Important Disclaimer – Not Financial Advice
Deep Value Reports is an independent research platform for educational and informational purposes only. We are not financial advisors, investment advisors, or licensed professionals. The analysis, scores, and information provided on this page for ON (ON Semiconductor Corp) should not be construed as personalized investment advice, a recommendation to buy or sell any security, or an offer to provide investment advisory services.
All investments involve risk, including the potential loss of principal. Past performance does not guarantee future results. Always conduct your own research, consider your financial situation, and consult with a qualified financial advisor before making any investment decisions.