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onsemi (ON) to Report Q1 Earnings: What's in the Cards?

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onsemi (ON - Free Report) is set to release first-quarter 2022 results on May 2.

For the first quarter, onsemi expects revenues between $1.85 billion and $1.95 billion. Earnings are expected between 98 cents and $1.10 per share.

For the first quarter, the Zacks Consensus Estimate for earnings is pegged at $1.05 per share, up by 1 cent in the past 30 days. The figure indicates a whopping surge of 200% from the year-ago quarter.

The consensus estimate for revenues stands at $1.91 billion, suggesting an improvement of 28.71% from the year-ago quarter.

onsemi’s earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 16.26%.

Let’s see how things are shaping up for the upcoming announcement.

Factors to Consider

onsemi first-quarter performance is likely to have benefited from rising demand for electric vehicles (EV), advanced driver assistance systems (ADAS), energy infrastructure and factory automation. The company’s selective investments to expand capacity for certain strategic products might have contributed to the to-be-reported quarter’s results.

The company may have gained from the EV megatrend in the first quarter, as the company’s silicon carbide modules power Daimler’s Mercedes EQXX electric vehicle platform. onsemi’s silicon carbides are aiding the Mercedes new electric vehicle gain a range of 620 miles.

The first-quarter revenues are expected to have benefited from additional capacity coming online. onsemi’s strategy to free up existing capacity to service industries enjoying megatrends and exit out of low-margin noncore products might have favored the to-be-reported quarter’s top line.

onsemi’s to-be-reported quarter’s top line is likely to reflect benefits from long-term supply agreements as it provides proper visibility for capacity planning and meet increasing demands.

The company might have benefited from the acquisition of GT Advanced Technologies, a producer of silicon carbide (SiC), as it enhances onsemi’s ability to secure and grow the supply of SiC.

What Our Model Indicates

Per the Zacks model, the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat.

onsemi has a Zacks Rank #3 and an Earnings ESP of +6.67%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Other Stocks to Consider

Here are some other companies worth considering, as our model shows that these too have the right combination of elements to beat on earnings in their upcoming releases:

BWX Technologies (BWXT - Free Report) has an Earnings ESP of +2.29% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

BWX shares have returned 9.2% in the year-to-date period compared with the Zacks Computer and Technology sector’s decline of 23.2%.

Fabrinet (FN - Free Report) has an Earnings ESP of +0.87% and a Zacks Rank of 2.

Fabrinet shares have fallen 16.2% in the year-to-date period.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.


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