ON Semiconductor Corp (ON) stock analysis

P/E above its 5-year median

ON Semiconductor's P/E of 42.8 is above its own 5-year median of 20.4.

P/E above the industry

ON Semiconductor's P/E of 42.8 is above the Electronic Components and Accessories median of 34.8.

EV/EBITDA above its 5-year median

ON Semiconductor's EV/EBITDA of 18.4 is above its 5-year median of 12.8.

P/B above the industry

ON Semiconductor's price-to-book of 3.79 is above the Electronic Components and Accessories median of 3.49.

Trading above fair value

The share price of $73.62 is above our fair value estimate of $54.33.

Margin of safety under 20%

The price is 35.5% above fair value, so there is no margin of safety.

Revenue growing under 10% a year

Revenue grew -10.4% a year over the last three fiscal years, short of the 10% we look for.

EPS growing under 10% a year

Diluted EPS grew -59.1% a year over the last three fiscal years.

Earnings growth accelerating

Net income grew 116% over the last twelve months, against a 5-year average of -12.4% a year.

Growing slower than the industry

Revenue grew 2.9% over the last twelve months; the Electronic Components and Accessories median is 17.3%.

Guidance lowered

ON Semiconductor lowered its fourth quarter of 2026 Other Income and Expense (including interest), net outlook on Nov 2, 2026.

Gross margin improving

Gross margin was 38.7% over the last twelve months, against 35.7% a year earlier.

Return on equity under 15%

Return on equity was 8.9% over the last twelve months and averaged 22.4% over five years; we look for 15% on both.

Return on capital under 10%

Return on invested capital was 7.7%, below the 10% that usually covers the cost of capital.

Return on equity above the industry

ON Semiconductor's return on equity of 8.9% is above the Electronic Components and Accessories median of 4.8%.

Earnings shrank over 5 years

Net income shrank 12.4% a year on average over the last five fiscal years.

Net margin below its 5-year average

Net margin was 10.8% over the last twelve months, against a 5-year average of 17.7%.

Net margin above the industry

ON Semiconductor's net margin of 10.8% is above the Electronic Components and Accessories median of 2.9%.

High debt

Debt is 59.0% of shareholders' equity, above the 40% we consider low.

Debt falling against equity

Debt to equity fell from 98.7% five years ago to 59.0%.

Debt covered by cash flow

Operating cash flow over the last twelve months equals 39.7% of total debt.

Interest well covered

Operating income covers interest expense 13.6 times.

Short-term assets cover short-term debts

Current assets are 3.55 times current liabilities.

Low bankruptcy risk

The Altman Z-score is 4.72; above 3 is the safe zone and below 1.8 the distress zone.

No dividend

ON Semiconductor has not paid a dividend in the last twelve months.

Yield against Treasuries

No dividend.

Yield against the market

No dividend.

Dividend stability

No dividend.

Earnings cover

No dividend.

Cash-flow cover

No dividend.