ON Semiconductor Corporation (ON): Alive and Kicking?

If you can handle volatility, ON Semiconductor Corporation (NASDAQ:ON) is the stock to watch now. The stock closed higher on 12 February. The shares accumulated 0.49 points or 2.2 percent at $22.73 with a light trade volume of 4.659 million shares. After opening the session at $22.52, the shares went as high as $22.785 and as low as $22.38, the range within which the stock’s price traded throughout the day. The firm is left with a market cap of $9.75 billion and now has 428.83 million shares outstanding. ON Semiconductor Corporation (ON) stock has gained 22.93 percent of market value in 21 trading days.

ON stock has a trailing 3-year beta of 2.03, offering the possibility of a higher rate of return, but also posing more risk. The portion of a company’s profit allocated to each outstanding share of common stock was $1.53 a share in the trailing twelve months. The stock’s value has surged 37.67 percent year to date (YTD) against a rise of 7.47 percent in 12 month’s time. The company’s shares still trade -16.13 percent away from its 1-year high of $27.10 and 56.22 percent up from 52-week low of $14.55. The average consensus rating on the company is 2.3, on a scale where 5 equates to a unanimous sell rating. In short, the mean analyst recommendations are calling this stock a sell.

ON Semiconductor Corporation (ON) will probably climb -2.02 percent over the next 12 months, according to price target estimates compiled by finviz. Meanwhile, they have set a $28 price as 12-month high target. This represents a whopping 23.19 percent increase from where shares are trading today. The 12-month median price target assigned by the analysts stands at $25, which represents a return potential of 9.99 percent when compared to the closing price of the stock of $22.73 on Tuesday, February 12. The lowest price target for the stock is $14.5 — slightly more than -36.21 percent from ON’s current share price.

History has shown that shares in ON Semiconductor Corporation have gone down on 4 different earnings reaction days and are predicted to add 0.04 percent when the company reports upcoming earnings. Investors will get their next glimpse of ON’s Q1 earnings on April 29. Analysts are forecasting revenue to climb 9 percent to $1.5B in the fiscal first quarter, while earnings are seen soaring by nearly 20.51 percent to $0.47 per share. It earned $0.57 per share, better than the $0.51, adjusted, expected by Thomson Reuters consensus estimate. Revenue was $1.5B, in line with the $1.5B analysts expected. Earnings are estimated to increase by 94.3 percent this year, 12.89 percent next year and continue to increase by 4.53 percent annually for the next 5 years.

Let’s take a look at some insider activity at ON Semiconductor Corporation (NASDAQ:ON) and see the pattern. The earliest insider trade took place on 02/05/2019. Hernandez Emmanuel T parted with a total of 10 thousand shares of company at average share price of $22. The total for the sales was set at $220 thousand. After this transaction, the Director account balance stood at 149.66 thousand shares. The stock grew 3.32 percent since that insider sale. On 01/25/2019, Hernandez Emmanuel T, Director, sold 30 thousand shares at a price per share of $20.01. This removed 600.3 thousand shares from the insider’s fortune and the stock saw a 13.59 percent rally in value since the news became public. This transaction left 159.66 thousand shares in the Director account.

On 12/14/2018, Director Delfassy Gilles performed a sale transaction worth $34.2 thousand. This sale at $17.1 each has eliminated 2 thousand shares from the insider’s portfolio position. Meanwhile, shares have recorded 32.92 percent increase since the transaction was reported. The insider now is left with 37.87 thousand shares remaining in the account. Colpitts Bernard Raymond Jr, who performs the Chief Accounting Officer job, sold 0.92 thousand shares for $15.98 thousand. The disposal occurred on 12/10/2018 was priced at $17.37 per share. The share price soared 30.86 percent since the reporting date. Colpitts Bernard Raymond Jr now left with a stake of 17.33 thousand ON stock worth $393.98 thousand after the insider selling.

The stock is currently hovering around the first support level of $22.48. Below this, the next support is placed in the zone of $22.23. Till the time, the ON stock trades above this level, bulls have nothing to fear. On momentum oscillators front, ‘RSI’ has touched 69.09 on daily chart, which may remain a cause for concern. If the price breaks below $22.23 level on closing basis, then we may see more profit booking and the stock may show further weakness. On the flipside, hitting the $22.88 mark may result into a pull-back move towards $23.03 level.

Shares of ON Semiconductor Corporation (ON) are trading at a P/E ratio of 14.58 times earnings reported for the past 12 months. The industry ON operates in has an average P/E of 4087.57. Its P/E ratio went as low as 10.86X and as high as 29.43 over the 5-year span.Further, it is sporting a 1.66 on the Price-to-Sales ratio. Compare this with the industry average P/S of 11.5. 38.1 percent is the gross profit margin for ON Semiconductor Corporation and operating margin sits at 12.2 percent. Along with this, the net profit margin is 15.9 percent.