Is ON Semiconductor Corporation overvalued?

In our latest published analysis dated 2026-10-22, ON looks meaningfully overvalued. The price recorded at analysis is 76,9 USD versus our fair value of 46,4 USD; the high endpoint is presented separately as potential value of 62,7 USD. That implies roughly 39.7% downside to fair value at that date.

What is ON's fair value?

Our latest published report, analyzed 2026-10-22, gives ON a fair value of 46,4 USD and a potential value of 62,7 USD. The conclusion is triangulated across multiple valuation models and weighted by reliability for ON Semiconductor Corporation's archetype; it is a dated research output, not a live price.

Our latest published rating for ON, analyzed 2026-10-22, is Sell. ON Semiconductor Corporation looks meaningfully overvalued at the analysis-date price of 76,9 USD versus fair value of 46,4 USD; potential value is 62,7 USD. This is research for educational purposes, not personalized investment advice.

What are the biggest risks for ON?

The dedicated bear-case section in our report analyzed 2026-10-22 documents ON Semiconductor Corporation's material risks, evidence, thresholds, and thesis-invalidation conditions. Scenario-specific explanations remain in that section so the report does not repeat or decontextualize them elsewhere.

Our latest published rating for ON, analyzed 2026-10-22, is Sell, with a published moat assessment of 6.5/10 (Narrow). It reflects our fair value of 46,4 USD, the potential value of 62,7 USD, and the price recorded at analysis (76,9 USD).

What archetype is ON?

In the latest published report analyzed 2026-10-22, ON Semiconductor Corporation is classified as a mature compounder stock. Archetype determines how every downstream parameter — discount rate, terminal growth, deceleration curve, terminal multiple, scenario probability weights, scorecard weights, and which valuation models are prioritized — is calibrated for ON.

ON stock analysis | StockMarketAgent.AI

StockMarketAgent researchAnalysé 2026-10-22

ON Semiconductor Corporation

Vendre

Baisse potentielle de 39,7 % vers la juste valeur

Report-date price

76,94 $US

Recorded 2026-10-21

Juste valeur

46,40 $US

Valeur potentielle

62,74 $US

Borne haute de valorisation

Avantage concurrentiel

Narrow6.5 / 10

Repli en anglaisFR

Affichage de la source anglaise pendant la traduction

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§1 RésuméEN

Réponse en 30 secondesSell

Prix par rapport à la valeur

Cours: $76.94
Juste valeur: $46.40
Valeur potentielle: $62.74
Au: 2026-10-21

Pourquoi le scénario peut fonctionner

Accelerated penetration of AI data center server rack power trees (where revenue is guided to more than double in 2026 via NVIDIA MGX integration) and high-efficiency 800V automotive traction inverters, which together with 25 to 30 bps gross margin gain per point of fab utilization could lift earnings toward the bull case.

Ce qui changerait notre avis

Chinese domestic silicon carbide substrate and wafer capacity expansion accelerates, driving substrate prices down and pushing non-GAAP gross margins below management guidance ranges.

ON Semiconductor Corporation carries a Sell rating with an intrinsic Fair value of $46.40 per share and Potential value of $62.74, representing -39.7% implied return from $76.94.

ON Semiconductor is executing a demonstrable operational recovery following a cyclical destocking trough in FY2025, when GAAP operating income fell to $84.2M on $5,995.4M revenue. In Q2 2026, revenue expanded 9% YoY to $1,603.5M, non-GAAP gross margin reached 39.3%, and quadrupled to $425.4M. AI data center revenue is guided to more than double in 2026, backed by expanding design wins across the NVIDIA MGX ecosystem.

§2 Cas baissierEN

A severe stress test evaluates the convergence of a 300 bps gross margin shock from Chinese silicon carbide substrate oversupply, negative annual top-line growth across automotive divisions, and a debt refinancing penalty on the $802.1M current liabilities at 14.48% pre-tax borrowing cost. Under these stressed parameters, the Fab-Liter operating leverage functions in reverse: unabsorbed fixed factory overhead drives gross margins toward the FY2025 trough level of 33.1%, while annual free cash flow compresses from $1,418.6M below $600M. Discounted at strict Ke of 13.29%, intrinsic equity value retreats toward the lower boundary of $22.97.

Bear scenario

Bear

Probability

25%

Return

-70.1%

Path target

$22.97

Gross margin fails to hold guided 40.0% floor.⁵
Automotive revenue experiences a double-dip contraction.
Exit P/E de-rates by 20% toward peer multiples.⁴

In the Bear case (25% probability), Chinese domestic silicon carbide oversupply triggers module price erosion, depressing gross margins toward 38%. Prolonged automotive destocking halts top-line growth, while $802.1M of maturing debt faces high refinancing yields at 14.48%, compressing equity value toward the $22.97 lower boundary.

Comment cette thèse peut échouer

Chinese SiC Price War and Capacity Oversupply

Rapid expansion of Chinese domestic silicon carbide substrate and wafer capacity creates systemic oversupply, depressing EliteSiC pricing and driving gross margins below the guided Q3 2026 non-GAAP range of 40.0% to 42.0% toward the FY2025 trough gross margin of 33.1%.⁵

FV impact

-1.6%

Operating margin 3 points lower throughout

Trigger

Within 12 months

Signaux d'alerte précoce à surveiller

Les cinq évolutions qui affaibliraient notre thèse d’investissement.

Non-GAAP Gross Margin

Gross margin falling below 38.0% falsifies the Fab-Liter operating leverage recovery thesis and signals that silicon carbide substrate price erosion is neutralizing utilization gains.

Actuel :39.3% non-GAAP in Q2 2026; guided 40.0% to 42.0% for Q3 2026

Alerte si< 38.0%

§3 Avantage concurrentielEN

Narrow

ON Semiconductor Corporation holds a Narrow economic moat derived from high customer switching costs and proprietary silicon carbide (EliteSiC) packaging integration across automotive and industrial power platforms. In FY2025, the Power Solutions Group generated $2,805.1M in revenue, representing 46.8% of consolidated top-line sales and anchoring leading positions in electric vehicle traction inverters and hyperscale AI data center power delivery.

Switching costs are entrenched by multi-year automotive qualification cycles. Tier-1 automotive OEMs and cloud infrastructure providers integrate ON's power modules and Treo platform into functional safety architectures (e.g., Rivian R2 zonal power distribution). Re-engineering high-voltage powertrain systems to accommodate alternative suppliers requires substantial non-recurring engineering expense and rigorous requalification, providing durable design lock-in across multi-year vehicle lifecycles.

The economic moat is bounded to Narrow rather than Wide due to structural commoditization risks across standard analog products and aggressive supply additions in silicon carbide. Analog and Mixed-Signal Group products ($2,261.9M FY2025 revenue) face intense merchant competition, while rapid state-subsidized expansion of Chinese domestic SiC wafer and substrate capacity threatens merchant module pricing.

Profit économique

Economic profit generation remains cyclical. In FY2025, GAAP operating profit fell to $84.2M, failing to generate economic profit above the company's cost of capital (WACC of 12.39%). While Fab-Liter operational leverage is designed to expand operating margins and restore returns on capital above the cost of capital, the October 21, 2026 share price of $76.94 already discounts this normalized profitability.^2,3,7

6.5/ 10

Narrow

Sources of advantage

Proprietary Packaging and Silicon Carbide System IntegrationVertical integration from silicon carbide crystal growth and 200mm substrate processing to custom multi-phase module packaging generated $2,805.1M in PSG revenue in FY2025, expanding content across the full NVIDIA MGX power architecture.Moderate
Automotive and Industrial Platform Switching CostsAutomotive functional safety qualifications lock in Tier-1 design wins across 800V EV traction inverters and zonal architectures (such as the Rivian R2 platform), where replacing incumbent power modules requires 18 to 24 months of requalification testing.Moderate

Menaces connues pour l'avantage
Menace	Gravité	Calendrier	Atténuation
Chinese Domestic Silicon Carbide Wafer and Substrate Capacity Oversupply	high	12 to 24 months	Differentiating via advanced planar-to-trench cell architectures, accelerating 200mm fab conversions, and introducing GaNEXUS gallium nitride portfolios spanning 40V to 650V applications.
Manufacturing Bottlenecks and Non-Fungible Supply Lane Constraints	medium

§5 Sensibilité

Taux d’actualisation

Croissance terminale

	2.5%	2.8%	3.0%	3.3%	3.5%
11.4%	$48.81	$49.33	$49.88	$50.46	$51.08
11.9%	$47.12	$47.58	$48.06	$48.58	$49.12
12.4%	$45.56	$45.97	$46.40	$46.86	$47.33
12.9%	$44.13	$44.50	$44.88	$45.28	$45.71
13.4%	$42.80	$43.12	$43.47	$43.83	$44.21

Lignes : taux d’actualisation (Ke pour les bénéfices ; WACC pour les flux de trésorerie). Colonnes : croissance terminale.

Variation de durée (années)

None of the valuation methods used to calculate Fair value relies on a separate assumption about how long the competitive advantage lasts.

Sensitivity reference

The highlighted cell is Fair value when every assumption sits at its base level ($46.40). Each row and column shows what Fair value becomes when one assumption moves.

Falaise des FCF

Free cash flow to the firm stays positive in the first projected year at $773.9M after modeled reinvestment of $258.0M, with terminal value at 68.1% of enterprise value. A sudden drop in free cash flow is not projected unless capital spending relative to revenue, reinvestment, or gross margin resets materially.

§7 Arbre de décision sur les résultatsEN

Dépassé

Maintain Sell; Accelerate planned divestment on liquidity spikes; monitor fab utilization gains and China EV order pacing.

Déclencheur: Q3 2026 revenue > $1.75B and non-GAAP EPS > $0.93⁵

An operational beat confirms rapid fab utilization recovery and AI data center demand, but with the stock trading at $76.94 versus intrinsic Fair value of $46.40, equity valuation already prices in upside execution.

Conforme

Maintain Sell; Maintain disciplined divestment schedule; re-examine lead-time normalization (currently 32 weeks) and distributor inventory levels (10.1 weeks).

Déclencheur: Q3 2026 revenue of $1.65B to $1.75B, non-GAAP EPS of $0.81 to $0.93, and gross margin of 40.0% to 42.0%⁵

In-line results validate steady post-trough recovery but leave shares exposed to valuation compression given the 65.82% market premium over intrinsic Fair value of $46.40.

Manqué

Maintain Sell; Execute immediate liquidation of remaining exposure without awaiting secondary rebounds, watching for refinancing pressure on current debt obligations.

Déclencheur: Q3 2026 revenue < $1.65B, non-GAAP EPS < $0.81, or gross margin < 40.0%⁵

An operational miss would indicate prolonged automotive inventory destocking or aggressive SiC price erosion, triggering sharp multiple compression toward intrinsic value.

Qualité des résultats

Earnings quality is supported by cash flow outperformance, with Q2 2026 free cash flow of $425.4M substantially exceeding GAAP net income of $226.8M. Non-GAAP adjustments totaled $67.0M in Q2 2026, comprising $41.2M in restructuring and impairments, $13.4M in inventory restructuring, and $11.7M in intangible amortization. Share-based compensation expense remained controlled at $37.4M in Q2 2026 and $144.3M in FY2025.⁷

Dynamique des estimations

Consensus revisions post-Q2 2026 earnings demonstrate upward momentum. Full-year FY2026 consensus EPS estimates rose from $3.12 to $3.22 (currently $3.21), while FY2027 consensus EPS estimates moved from $4.34 to $4.56 (currently $4.54). Consensus FY2026 revenue stands at $6,561.8M.¹

Métriques à surveiller avant publication

Métrique:
Non-GAAP Gross Margin Trajectory
Actuel39.3% non-GAAP in Q2 2026; guided to 40.0%-42.0% for Q3 2026.
Pourquoi c'est important
Measures Fab-Liter operating leverage execution, where each 1 percentage point increase in factory utilization delivers 25 to 30 bps of gross margin gain.⁵

§8 Historique financier

Compte de résultat — six derniers exercices
Period	2021-12-31	2022-12-31	2023-12-31	2024-12-31	2025-12-31	Trend
Revenue	$6.74B	$8.33B	$8.25B	$7.08B	$6.00B	-2.9%
Gross profit	$2.71B	$4.08B	$3.88B	$3.22B	$1.98B	-7.5%
Operating income	$1.29B	$2.36B	$2.54B	$1.77B	$84.2M	-49.4%
Net income	$1.01B	$1.90B	$2.18B	$1.57B	$121.0M	-41.2%
EPS (diluted)	$2.27	$4.25	$4.89	$3.63	$0.29	-40.2%
EBITDA	$1.88B	$3.01B	$2.54B	$2.54B	$888.2M	-17.1%
R&D	$655.0M	$600.2M	$577.3M	$612.7M	$583.6M	-2.8%
SG&A	$304.8M	$343.2M	$362.4M	$376.3M	$348.9M	+3.4%

Prévision annuelle retenue
Métrique	2026	2027	2028	2029	2030
Revenue	$6.56B	$7.42B

Flux de trésorerie

Cash flow generation has rebounded sharply from the FY2025 trough. Operating cash flow reached $459.7M in Q2 2026, compared to $1,759.8M for the entirety of FY2025. Free cash flow margin expanded to approximately 27% in Q2 2026 ($425.4M FCF on $1,603.5M revenue), driven by disciplined working capital management (strategic inventory down 8 days) and tight capex controls under Fab-Liter.^5,7

Allocation du capital

Capital allocation prioritizes share repurchases and balance sheet liquidity. In Q2 2026, ON repurchased $332M of , bringing year-to-date capital returns to ~105% of . The company pays no ordinary dividend. totaled $3,514.5M, providing ample liquidity to address the $802.1M maturing debt obligation without mandatory refinancing.

ROIC

Return on invested capital collapsed in FY2025 as GAAP operating profit fell to $84.2M (1.4% EBIT margin) due to cyclical destocking charges. The trajectory is now improving, with Q2 2026 non-GAAP operating margin reaching 20.8% and forecast EBIT projected at $1,214.0M in FY2026 (18.5% margin) and $1,558.9M in FY2027 (21.0% margin).

In FY2025, ROIC fell well below WACC (12.39%). With normalized operating profits, ROIC is projected to expand above WACC, but this recovery is already priced into the equity at $76.94.

Fab-Liter Operational Leverage Accelerates Gross Margin Recovery

Q2 2026 non-GAAP gross margin reached 39.3%, while CFO Trent confirmed that every 1 percentage point increase in factory utilization yields 25 to 30 bps of gross margin improvement, supporting Q3 of 40.0% to 42.0%.

Dernier chiffre d’affaires6 Md $USTCAC du chiffre d’affaires +4,9 %

Marge opérationnelle1,4 %10 périodes fiscales

Dernier flux de trésorerie disponible1,4 Md $USFY2025

Dette nette432,9 M $USFY2025

Décomposition du compte de résultatComment la taille de l’activité se traduit en bénéfice publié.

StockMarketAgent.AI

Données de l’historique financier
Chiffre d'affaires	5 995 400 000 $US
Coût des ventes	4 011 500 000 $US
Marge brute	1 983 900 000 $US
Charges d’exploitation	1 899 700 000 $US
Résultat d'exploitation	84 200 000 $US
Éléments hors exploitation et impôts	36 800 000 $US
Résultat net	121 000 000 $US

Aperçu du bilanComment les actifs publiés sont détenus et financés pour la période sélectionnée.

StockMarketAgent.AI

Données de ventilation du bilan
Total de l’actif	12 524 100 000 $US
Trésorerie	2 147 600 000 $US
Actifs courants	5 823 100 000 $US
Total du passif	4 832 200 000 $US
Passifs courants	1 287 700 000 $US
Capitaux propres	7 691 900 000 $US

Passerelle des flux de trésorerieComment le flux de trésorerie d’exploitation est devenu du flux de trésorerie disponible en FY2025.

StockMarketAgent.AI

Rapprochement des flux d’exploitation

Résultat net121 M $USDotations aux amortissements+686 M $USRémunération en actions+144,3 M $USAutres ajustements opérationnels+808,5 M $USFlux de trésorerie d'exploitation1,8 Md $US

Rapprochement de la trésorerie d’ouverture à la clôture

Trésorerie d’ouverture2,7 Md $USFlux de trésorerie d'exploitation+1,8 Md $USFlux d’investissement−538,5 M $USFlux de financement−1,8 Md $USEffet de change−1,9 M $USTrésorerie de clôture2,1 Md $US

1,8 Md $US − 341,2 M $USFlux de trésorerie disponible 1,4 Md $US

Données de la passerelle des flux de trésorerie
Résultat net	121 000 000 $US
Entrées d’exploitation	1 759 800 000 $US
Dotations aux amortissements	686 000 000 $US
Rémunération en actions	144 300 000 $US
Autres ajustements opérationnels	808 500 000 $US
Flux de trésorerie d'exploitation	1 759 800 000 $US
Trésorerie disponible	4 453 200 000 $US
Trésorerie d’ouverture	2 693 400 000 $US
Sorties d’investissement	538 500 000 $US
Capex	341 200 000 $US
Autres activités d’investissement	197 300 000 $US
Sorties de financement	1 763 800 000 $US
Rachats d’actions	1 377 600 000 $US
Remboursement net de dette	376 700 000 $US
Autres activités de financement	9 500 000 $US
Effet de change	1 900 000 $US
Trésorerie de clôture	2 149 000 000 $US
Flux d’investissement	-538 500 000 $US
Flux de financement	-1 763 800 000 $US

Chiffre d’affaires par secteur opérationnelPart du chiffre d’affaires total pour 2025-12-31.

Chiffre d’affaires par secteur opérationnelPart

Power Solutions Group2,8 Md $US46,8 %−16,2 % sur un an

Analog Mixed Signal Group2,3 Md $US37,7 %−13,3 % sur un an

Intelligent Sensing Group928,4 M $US15,5 %−17,5 % sur un an

Source: SEC EDGAR · Déposé le 2026-02-09 · SEC EDGAR

Données de répartition du chiffre d’affaires: Chiffre d’affaires par secteur opérationnel
Chiffre d’affaires par secteur opérationnel	Chiffre d'affaires	Part	sur un an
Power Solutions Group	2,8 Md $US	46,8 %	-16,2 %
Analog Mixed Signal Group	2,3 Md $US	37,7 %	-13,3 %
Intelligent Sensing Group	928,4 M $US	15,5 %	-17,5 %

Chiffre d’affaires par zone géographiquePart du chiffre d’affaires total pour 2025-12-31.

Chiffre d’affaires par zone géographiquePart

Hong Kong SAR China1,6 Md $US27,3 %−8,1 % sur un an

United Kingdom1,3 Md $US22,5 %−17,8 % sur un an

Singapore1,3 Md $US20,9 %−27,7 % sur un an

United States1,2 Md $US20,5 %−5,9 % sur un an

Other Geographical Areas530,6 M $US8,9 %−15 % sur un an

Source: SEC EDGAR · Déposé le 2026-02-09 · SEC EDGAR

Données de répartition du chiffre d’affaires: Chiffre d’affaires par zone géographique
Chiffre d’affaires par zone géographique	Chiffre d'affaires	Part	sur un an
Hong Kong SAR China	1,6 Md $US	27,3 %	-8,1 %
United Kingdom	1,3 Md $US	22,5 %	-17,8 %
Singapore	1,3 Md $US	20,9 %	-27,7 %
United States	1,2 Md $US	20,5 %	-5,9 %
Other Geographical Areas	530,6 M $US	8,9 %	-15 %

Chiffre d’affaires et résultatsComment la taille de l’activité se traduit en bénéfice publié.

Trésorerie et detteLiquidités disponibles face à l’endettement total.

Génération de trésorerieFlux de trésorerie d’exploitation comparé au flux de trésorerie disponible.

RentabilitéÉvolution des marges brute, opérationnelle et nette.

Données financières ponctuelles utilisées dans l’analyse du 2026-10-22.

Données de l’historique financier
Période	Chiffre d'affaires	EBITDA	Résultat net	Flux de trésorerie d'exploitation	Flux de trésorerie disponible	Capex	Dotations aux amortissements	Rémunération en actions	Rachats d’actions	Dividendes versés	Émission nette de dette	Flux d’investissement	Flux de financement	Trésorerie d’ouverture	Trésorerie de clôture	Trésorerie et placements	Dette totale	Marge opérationnelle	ROIC	WACC	Écart ROIC−WACC
2016-12-31	3,9 Md $US	690 M $US	182,1 M $US	581,1 M $US	370,4 M $US	210,7 M $US	364,1 M $US	56,1 M $US	0 $US	4,3 M $US	—	-2,4 Md $US	2,3 Md $US	—	1 Md $US	1 Md $US	3,8 Md $US	6,3 %	—	8,2 %	—
2017-12-31	5,5 Md $US	1,2 Md $US	810,7 M $US	1,1 Md $US	706,7 M $US	387,5 M $US	481,9 M $US	69,8 M $US	25 M $US	1,2 Md $US	—	-364,8 M $US	-810,9 M $US	1 Md $US	966,6 M $US	966,6 M $US	3,2 Md $US	12,3 %	—	7,1 %	—
2018-12-31	5,9 Md $US	1,4 Md $US	627,4 M $US	1,3 Md $US	759,4 M $US	514,8 M $US	508,7 M $US	78,3 M $US	315,3 M $US	21 M $US	—	-548,9 M $US	-605,1 M $US	966,6 M $US	1,1 Md $US	1,1 Md $US	2,9 Md $US	14,4 %	—	7,1 %	—
2019-12-31	5,5 Md $US	1 Md $US	211,7 M $US	694,7 M $US	160,1 M $US	534,6 M $US	593,1 M $US	79,4 M $US	139 M $US	26,2 M $US	—	-1,5 Md $US	623,1 M $US	1,1 Md $US	894,2 M $US	894,2 M $US	3,7 Md $US	7,8 %	—	7,5 %	—
2020-12-31	5,3 Md $US	970,1 M $US	234,2 M $US	884,3 M $US	500,7 M $US	383,6 M $US	625,1 M $US	67,7 M $US	65,4 M $US	23,6 M $US	—	-453,6 M $US	-244 M $US	894,2 M $US	1,1 Md $US	1,1 Md $US	3,6 Md $US	6,6 %	—	7,5 %	—
2021-12-31	6,7 Md $US	1,9 Md $US	1 Md $US	1,8 Md $US	1,3 Md $US	444,6 M $US	596,7 M $US	101,3 M $US	0 $US	38,9 M $US	—	-915,1 M $US	-569,4 M $US	1,1 Md $US	1,4 Md $US	1,4 Md $US	3,3 Md $US	19,1 %	—	8,0 %	—
2022-12-31	8,3 Md $US	3 Md $US	1,9 Md $US	2,6 Md $US	1,6 Md $US	1 Md $US	551,8 M $US	100,8 M $US	259,8 M $US	4,3 M $US	-41,5 M $US	-705,4 M $US	-370 M $US	1,4 Md $US	2,9 Md $US	2,9 Md $US	3,2 Md $US	28,3 %	—	10,4 %	—
2023-12-31	8,3 Md $US	2,5 Md $US	2,2 Md $US	2 Md $US	438,4 M $US	1,5 Md $US	609,5 M $US	121,1 M $US	564,2 M $US	2,1 Md $US	106,3 M $US	-1,7 Md $US	-686,5 M $US	2,9 Md $US	2,5 Md $US	2,5 Md $US	3,4 Md $US	30,8 %	—	10,8 %	—
2024-12-31	7,1 Md $US	2,5 Md $US	1,6 Md $US	1,9 Md $US	1,2 Md $US	694 M $US	642,9 M $US	136,1 M $US	654,1 M $US	—	-2,2 M $US	-1 Md $US	-683,8 M $US	2,5 Md $US	2,7 Md $US	3 Md $US	3,3 Md $US	25,0 %	—	10,8 %	—
2025-12-31	6 Md $US	888,2 M $US	121 M $US	1,8 Md $US	1,4 Md $US	341,2 M $US	686 M $US	144,3 M $US	1,4 Md $US	—	-376,7 M $US	-538,5 M $US	-1,8 Md $US	2,7 Md $US	2,1 Md $US	2,5 Md $US	3 Md $US	1,4 %	—	11,0 %	—

§9 Comparaison de valorisation avec les pairs

ON Semiconductor CorporationON

Cours / juste valeur

Juste valeur46,4 $USReport-date price76,94 $US

Date d’évaluation22 oct. 2026

Avantage concurrentielNarrow

Score d’investissement60 / 100

Teledyne Technologies IncorporatedTDY

Cours / juste valeur

Juste valeur460,57 $USReport-date price621,02 $US

Date d’évaluation05 oct. 2026

Avantage concurrentielNarrow

Score d’investissement64 / 100

Cognizant Technology Solutions CorporationCTSH

Cours / juste valeur

Juste valeur94,37 $USReport-date price58,17 $US

Date d’évaluation05 oct. 2026

Avantage concurrentielNarrow

Score d’investissement71 / 100

ON Semiconductor CorporationON

Cours / juste valeur

Juste valeur46,4 $USReport-date price76,94 $US

Date d’évaluation22 oct. 2026

Avantage concurrentielNarrow

Score d’investissement60 / 100

Multiples des pairs et rentabilité
Symbole	Nom	Cap. boursière	P/E	P/S	EV/EBITDA	ROE

ON Semiconductor Corporation (ON) trades at 16.5x forward earnings against a peer median of 25.8x. Its EV/EBITDA of 14.7x compares with a peer median of 22.0x. The comparison uses 4 peers: Teledyne Technologies Incorporated, Cognizant Technology Solutions Corporation, VeriSign Inc. and Marvell Technology Inc., as of 2026-10-21 to 2026-10-22.

§10 Secteur et cycleEN

Phase du cycle

Trough

Capex-to-revenue was 2.1% in Q2 2026 ($34.3M on $1,603.5M revenue) and 5.7% in FY2025 ($341.2M on $5,995.4M), below the industry benchmark capex/revenue of 4.4%. Industry capex-to-depreciation stands at 1.27x, while lead times have stretched from 27 weeks to approximately 32 weeks.^5,7

Cycle haussier

A cyclical upcycle driven by accelerated 800V EV platform rollouts, doubling AI data center rack power infrastructure deployments, and expanding content per rack, driving factory utilization gains that deliver 25 to 30 bps of gross margin improvement per percentage point.

Cycle baissier

A downcycle characterized by extended automotive OEM inventory digestion, softening EV demand, and aggressive Chinese domestic SiC wafer expansion that causes module pricing deflation and idle fab capacity charges.

Tendances séculaires
Tendance	Impact	Note
AI Data Center Gigawatt Buildout and Power Tree Expansion	positive	Hyperscalers are scaling server rack power architectures to accommodate megawatt-to-gigawatt AI clusters by 2030, driving demand for multi-phase controllers and high-voltage power devices.
Automotive 800V Powertrain and Zonal Architecture Transition	positive	Global automotive OEMs are transitioning electric vehicles to 800V architectures to enable faster charging and higher inverter efficiency, expanding silicon carbide module content per vehicle.

Positionnement

ON Semiconductor is positioned as a specialized power and sensing provider transitioning to a Fab-Liter manufacturing footprint. By combining internal proprietary packaging with flexible external wafer sourcing, the company optimizes fixed-cost absorption while focusing capital on high-margin automotive and AI data center solutions.

§11 Gestion de positionEN

Taille de position

The rating is Sell. With shares trading at $76.94 against our intrinsic Fair value of $46.40 (representing -39.7% return), capital should not be allocated to long positions.

Risque

Risk management focuses on avoiding capital impairment from multiple compression. ON's raw regression beta of 1.939 and adjusted beta of 1.7214 highlight elevated cyclical sensitivity. Maintaining zero long exposure eliminates vulnerability to cyclical pullbacks.

Tranches d'entrée
Niveau	Action	Pourquoi
$46.40	Initiate fundamental re-evaluation	Intrinsic Fair value midpoint. Eliminates the current market premium but does not yet provide an adequate margin of safety.
$37.12	Consider initial speculative tranche	Provides a 15% to 20% discount to intrinsic Fair value, conditioned on non-GAAP gross margins sustaining above 40.0%.
Below $37.12	Consider high-conviction value entry

Tranches de sortie
Niveau	Action
$76.94	Liquidate half of remaining long holdings
Above $76.94	Complete full liquidation of all long exposure

Points de contrôle trimestriels
Métrique	Seuil	Action
Non-GAAP Gross Margin	Falling below guided floor in Q3 2026	Indicates pricing concessions in silicon carbide; reduce terminal valuation assumptions.⁵
PSG Segment Revenue Growth

§14 Recommandation finaleEN

Action

Vendre

ON Semiconductor Corporation is assigned a Sell rating. Although management's Fab-Liter strategy and AI data center expansion are delivering operational improvements, current equity pricing reflects aggressive multi-year execution with zero margin of safety.³

Investors should exit existing long equity positions and reallocate capital to securities offering positive risk-adjusted returns.

ON	ON Semiconductor Corporation	$30.0B	16.5x	4.8x	14.7x	8.3%	—
TDY	Teledyne Technologies Incorporated	$29.2B	23.5x	4.6x	19.5x	9.2%	20.2%
CTSH	Cognizant Technology Solutions Corporation	$32.2B	10.8x	1.5x	7.9x	14.9%	17.5%
VRSN	VeriSign Inc.	$27.7B	28.1x	16.2x	24.4x	—	68.2%
MRVL	Marvell Technology Inc.	$220.0B	33.4x	23.3x	75.8x	16.5%	16.7%

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Présentation de l’entreprise

Non-GAAP Gross Margin

Narrow

Sources of advantage

Lenses that set Fair value

Discounted Earnings

Non-GAAP Gross Margin Trajectory

Sources

Consolidated Annual Revenue Growth

Current Portion of Long-Term Debt

Distributor Customer Concentration

Power Solutions Group Revenue Share

Forward Earnings

Cash flow DCF

Owner Earnings

Checks and reference points

Reverse DCF

PEG-adjusted Peer

AI Data Center Revenue Run-Rate

Manufacturing Lead Times and Lane Constraints

Current Debt Maturities and Balance Sheet Management

Distribution Channel Inventory Weeks