On Semiconductor Corp (ON) is driving energy efficient innovations, empowering customers to reduce global energy use. The company is a leading supplier of semiconductor-based solutions, offering a comprehensive portfolio of energy efficient power management, analog, sensors, logic, timing, connectivity, discrete, SoC and custom devices. The company’s products help engineers solve their unique design challenges in automotive, communications, computing, consumer, industrial, medical, aerospace and defense applications. ON Semiconductor operates a responsive, reliable, world-class supply chain and quality program, a robust compliance and ethics program, and a network of manufacturing facilities, sales offices and design centers in key markets throughout North America, Europe and the Asia Pacific regions
Ensuing downgrades of analysts at Pacific Crest, On Semiconductor Corp’s rating from Equal Weight to Underweight, the stock has already fallen over 4.33% in today’s late morning trading sessions. The Semiconductor company’s shares has been deteriorated nearly 20% in the last 12 months based on the broader market selloff and continued weakness in the chip making sector.
The Phoenix-based company’s acquisition of fellow semiconductor maker Fairchild Semiconductor is expected to add 35 cents per share to annual earnings with synergies exceeding the $150 million target, Pacific Crest analysts wrote in a note released this morning.
In the view of escalated revenue per vehicle, driven by the strong Advanced Driver Assistance Systems (ADAS) penetration, the research firm postulates that company has significant growth potential. Moreover, analysts at Pacific Crest see a significant amount of earnings per share accretion owing to its buyout of Fairchild Semiconductor.
There were some financial revelations from On Semiconductor last month for the first quarter of 2016, reporting mixed results for the quarter, posting $817.2 million in total revenues as compared to the Street’s expectation of $820 million. By the same token, adjusted EPS came in at 17 cents, defeating consensus estimates by two cents.
In addition to aforementioned, ON Semiconductor stock has surged more than 12% in the last 12 days as compared to chipmaker Index SOX which jumped nearly 11%. The chipmaker forecast to generate revenues within the $835-875 million range for its current period, in comparison to Street’s mingy estimate of $855.2 million.
ON Semiconductor CEO Keith Jackson issued optimistic comments through the company’s quarterly release as he stated, “During Q1, we noticed a stabilization in business conditions, although a few end-markets experienced greater than expected softness. With a strong design win pipeline and exposure to faster growing segments within a diverse group of end-markets, we remain well positioned to outgrow the semiconductor industry.”
During the past fiscal year, ON Semiconductor Corp increased its bottom line by earning $0.49 versus $0.43 in the prior year. This year, the market expects an improvement in earnings ($0.85 versus $0.49).
40.69% is the gross profit margin for ON Semiconductor Corp which is considered to be strong. Regardless of ON’s high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 4.40% trails the industry average.