One-glance verdict
Within fair range
$46.56 our estimate vs market $74.38
Wall Street consensus: $107.08 (130.0% higher than our fair-value estimate)
60% above our estimate
Fundamentals snapshot
ON Semiconductor Corporation
ON · NMS · Technology · Semiconductors
Current price
$74.38
52-week range
$44.56 - $134.92
Market cap
$28.96B
Balance sheet
Healthy
10.59x Adequate
Net debt $844.50M. Interest coverage shows how many times profit covers the interest bill.
What stands out
3 Rewards
2 Risks
3 rewards · 2 risks
- Reward Revenue grew 3.4% last year.
- Reward Returns 8.3% on equity, ahead of 50% of its peers.
- Risk Net debt grew 46.7% over 3 years.
- Risk Operating margin compressed from 33.2% to 19.5% over 3 years.
What this company does
ON Semiconductor Corporation
ON Semiconductor makes specialized electronic components, often called chips, that act like the brains and power controls for various technologies. The company makes most of its money selling these chips to car manufacturers for electric vehicles and to industrial companies for factory robots. This matters because as the world shifts toward more electric cars and automated factories, the need for ON's specific types of chips is expected to increase.
How the company got here
Originally the part of Motorola that made basic computer chips, ON Semiconductor was spun off as its own company in 1999. For many years, it focused on making a wide variety of standard chips. A major turning point was the purchase of a competitor, Fairchild Semiconductor, in 2016, which boosted its expertise in chips that manage high-power electricity. More recently, under a new CEO appointed in 2020, the company rebranded to 'onsemi' and shifted its strategy to focus on more specialized, high-value chips for the automotive and industrial sectors.
What it actually does
ON Semiconductor, now called onsemi, makes essential chips that manage power and sense the world around them. You wouldn't typically buy their products directly, but they are critical components inside things you use every day, like your car, computers, and even the systems that power the internet. These chips do things like convert electricity to the right level for a device to work, help electric vehicles charge faster, and enable cameras in cars and factory robots to 'see'. The company focuses on creating solutions for electric vehicles, advanced safety systems in cars, solar power, and the massive data centers that run AI applications.
Power Solutions Group
This is the company's largest division and it makes chips that are the 'muscles' for electronic systems. These products control the flow and conversion of electricity, which is crucial for everything from electric vehicle drivetrains to the power supplies in giant AI data centers. For example, their chips help an electric car efficiently use power from its battery and enable the 'fast charging' that gets you back on the road quickly. This segment provides the high-power components that make modern, energy-hungry technologies possible and efficient.
Analog and Mixed-Signal Group
Think of this group as making the 'brains' that manage the power 'muscles'. These chips don't just switch power on and off; they intelligently manage it, sense what's happening in a circuit, and communicate that information. For instance, in a car, these chips can monitor battery health or manage the power going to various electronic systems. This segment designs complex products that combine analog functions (like measuring real-world signals such as voltage) with digital functions (processing information with 1s and 0s).
Intelligent Sensing Group
This division creates the 'eyes' for machines. It develops advanced image sensors and processors that allow cars and robots to see and interpret their surroundings. These are used in advanced driver-assistance systems (often called ADAS) to enable features like automatic emergency braking and lane-keeping assist. In a factory, these sensors might guide a robot to pick up a specific object or ensure a safety system stops the machinery if a person gets too close. This group is focused on giving machines the ability to perceive the physical world.
What management is betting on now
The company's leadership is heavily focused on two major trends: electric vehicles (EVs) and artificial intelligence (AI). They are investing in making specialized chips from materials like Silicon Carbide (SiC), which are much more efficient for high-power uses like EV charging and drivetrains. By controlling the entire manufacturing process, from raw materials to the finished chip, they aim to ensure a reliable supply chain (the entire process of making and selling goods) for carmakers. For AI, they are developing power solutions that can make energy-hungry data centers more efficient, which is a huge challenge as AI becomes more widespread.
Price history
How the share price has moved
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Earnings history
Last 8 quarters — what happened
Click any quarter to read the call summary and what the numbers say.
FY2024 Q4
$434.80M
FY2025 Q2
$454.70M
FY2025 Q3
$106.10M
FY2025 Q4
$372.40M
FY2026 Q2
$217.20M
FY2026 Q3
$425.40M
Revenue
$1.60B
Net income
$226.80M
Diluted EPS
0.56
Operating cash flow
$459.70M
Free cash flow
$425.40M
Fetching…
Sources
Revenue
$1.51B
Net income
$-33.40M
Diluted EPS
-0.08
Operating cash flow
$239.10M
Free cash flow
$217.20M
Fetching…
Sources
Revenue
$1.55B
Net income
$255.00M
Diluted EPS
0.63
Operating cash flow
$418.70M
Free cash flow
$372.40M
Fetching…
Sources
Revenue
$1.47B
Net income
$170.30M
Diluted EPS
0.41
Operating cash flow
$184.30M
Free cash flow
$106.10M
Fetching…
Sources
Revenue
$1.45B
Net income
$-486.10M
Diluted EPS
-1.15
Operating cash flow
$602.30M
Free cash flow
$454.70M
Fetching…
Sources
Revenue
$1.72B
Net income
$379.90M
Diluted EPS
0.88
Operating cash flow
$579.70M
Free cash flow
$434.80M
Fetching…
Sources
Is it cheap or expensive?
Fair value $46.56 vs current price $74.38
Wall Street consensus is the average analyst price target: $107.08 (130.0% higher than our fair-value estimate).
Our most-likely fair value is $46.56 a share — about 37.4% away from today's price of $74.38, so the stock currently looks fairly priced.
Is it drowning in debt?
Healthy
Net debt $844.5M. Interest coverage 10.6x.
Net debt
$844.50M
Interest coverage
10.59x
ON Semiconductor Corporation's profit covers its interest bill about 10.6 times over. which is stronger than every peer shown here and 1 peers sit below 1x, which is the danger zone where profit does not fully cover the interest bill.
Healthy
Worse cushion
Baseline
Better cushion
ON
BASELINE
ON Semiconductor Corporation
Total debt $4.71B Interest coverage 10.59x This is the baseline the peer rows are being compared against.
Total debt $5.40B Interest coverage 2.46x -77% vs ON Carries about 4.3x less debt cushion than ON.
Total debt $10.98B Interest coverage 6.51x -39% vs ON Carries about 1.6x less debt cushion than ON.
Total debt $4.23B Interest coverage 5.87x -45% vs ON Carries about 1.8x less debt cushion than ON.
Total debt $8.41B Interest coverage 8.80x -17% vs ON Carries about 1.2x less debt cushion than ON.
Total debt $7.53B Interest coverage 0.82x -92% vs ON Carries about 12.9x less debt cushion than ON.
What you should know
The case for and against ON
3 Rewards
2 Risks
Rewards
-
Revenue grew 3.4% last year.
-
Returns 8.3% on equity, ahead of 50% of its peers.
-
Free cash flow was positive in 10/10 years.
Risks
-
Net debt grew 46.7% over 3 years.
-
Operating margin compressed from 33.2% to 19.5% over 3 years.
The numbers
All the key metrics, grouped by purpose
Tap any ? icon to learn what it means.
Valuation
How expensive the stock looks
P/E (TTM)
48.61x
Forward P/E
16.42x
P/B
4.01x
P/S
4.67x
EV/EBITDA
14.27x
PEG ratio
0.17x
Profitability
How much profit each dollar creates
Gross margin
42.8%
Operating margin
19.5%
Net margin
10.2%
ROE
8.3%
ROA
6.8%
Health
Liquidity and balance-sheet strength
Debt / equity
0.65x
Current ratio
3.46x
Quick ratio
2.29x
Total debt
$4.71B
Total cash
$3.86B
Growth
How the business has been compounding
Revenue TTM
$6.20B
Revenue 5Y CAGR
-2.9%
EPS TTM
1.53
EPS 5Y CAGR
-59.1%
Cash flow
How much cash the business throws off
Operating CF TTM
$1.67B
Free CF TTM
$1.42B
FCF margin
22.9%
Dividend
Shareholder payout
Yield
—
Payout ratio
0.0%
Last ex-div date
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