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ON Semiconductor Corp. (ON) Stock Sinks As Market Gains: Here's Why

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The latest trading session saw ON Semiconductor Corp. (ON - Free Report) ending at $70.53, denoting a -0.79% adjustment from its last day's close. The stock trailed the S&P 500, which registered a daily gain of 0.97%. Elsewhere, the Dow gained 0.3%, while the tech-heavy Nasdaq added 1.45%.

Prior to today's trading, shares of the semiconductor components maker had gained 2.45% over the past month. This has lagged the Computer and Technology sector's gain of 8.21% and the S&P 500's gain of 5.41% in that time.

The upcoming earnings release of ON Semiconductor Corp. will be of great interest to investors. The company is expected to report EPS of $0.97, down 30.22% from the prior-year quarter. Meanwhile, the latest consensus estimate predicts the revenue to be $1.75 billion, indicating a 19.77% decrease compared to the same quarter of the previous year.

For the entire fiscal year, the Zacks Consensus Estimates are projecting earnings of $4.01 per share and a revenue of $7.13 billion, representing changes of -22.29% and -13.6%, respectively, from the prior year.

Investors might also notice recent changes to analyst estimates for ON Semiconductor Corp. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, upbeat changes in estimates indicate analysts' favorable outlook on the company's business health and profitability.

Our research demonstrates that these adjustments in estimates directly associate with imminent stock price performance. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system, running from #1 (Strong Buy) to #5 (Strong Sell), holds an admirable track record of superior performance, independently audited, with #1 stocks contributing an average annual return of +25% since 1988. Over the past month, there's been no change in the Zacks Consensus EPS estimate. At present, ON Semiconductor Corp. boasts a Zacks Rank of #4 (Sell).

Looking at its valuation, ON Semiconductor Corp. is holding a Forward P/E ratio of 17.73. This denotes a discount relative to the industry's average Forward P/E of 35.71.

We can additionally observe that ON currently boasts a PEG ratio of 3.81. Comparable to the widely accepted P/E ratio, the PEG ratio also accounts for the company's projected earnings growth. The average PEG ratio for the Semiconductor - Analog and Mixed industry stood at 3.26 at the close of the market yesterday.

The Semiconductor - Analog and Mixed industry is part of the Computer and Technology sector. This industry, currently bearing a Zacks Industry Rank of 210, finds itself in the bottom 17% echelons of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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