ON Semiconductor Corporation (ON) is one of the most trending stocks recently by Zacks.com visitors. Therefore, we recommend considering several factors that can affect a stock’s short-term performance.
Shares of the semiconductor components maker have gained -9.7% over the past month compared to a -2.4% rise in the Zacks S&P 500 Composite Index. The Zacks Semiconductor – Analog and Mixed industry, which includes ON Semiconductor, has declined 5.7% in this period. The key question here is where the stock is likely to go in the short term.
While media releases and rumors about significant changes in a company’s business prospects typically cause its stock to “trend” and lead to immediate price movements, there are some fundamentals that ultimately govern buy-and-hold decisions. There are always facts.
At Zacks, we prioritize evaluating changes in company earnings estimates rather than focusing on anything else. This is because we believe that the fair value of a stock is determined by the present value of its future income stream.
Our analysis is fundamentally based on how the sell-side analysts covering a given stock are revising their earnings estimates to account for the latest business trends. As a company’s earnings expectations rise, so does the fair value of its stock. And when a stock’s fair value is higher than its current market price, investors tend to buy the stock, which causes the stock price to rise. For this reason, empirical research has shown that there is a strong correlation between trends in earnings forecast revisions and short-term stock price movements.
ON Semiconductor, Inc. is expected to post earnings of $0.99 per share for the current quarter, representing a year-over-year change of -20.8%. The Zacks Consensus Estimate remained unchanged over the past 30 days.
The consensus earnings estimate for the current fiscal year of $4 represents a year-over-year change of -22.5%. This estimate has changed -0.2% over the past 30 days.
Next year’s consensus earnings estimate of $4.38 represents a +9.5% change from the earnings that ON Semiconductor, Inc. was expected to report a year ago. Estimates have not changed over the past month.
The Zacks Rank, a proprietary stock evaluation tool with a strong, outside-audited track record, effectively harnesses the power of earnings estimate revisions to provide a more definitive picture of near-term stock price direction. Provides a complete picture. The magnitude of recent consensus estimate changes, as well as three other factors related to earnings estimates, give ON Semiconductor Corporation a Zacks Rank #4 (Sell).
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The chart below shows the evolution of the company’s consensus EPS estimate for the next 12 months.
Earnings growth is arguably the best indicator of a company’s financial health, but nothing will happen if a company can’t grow its revenue. After all, it’s nearly impossible for a company to increase profits over a long period of time without increasing revenue. Therefore, it’s important to know a company’s earnings growth potential.
ON Semiconductor’s current quarter consensus revenue estimate is $1.76 Billion, representing a year-over-year change of -12.7%. Estimates for the current and next fiscal year are $7.12 billion and $7.47 billion, representing changes of -13.7% and +4.9%, respectively.
ON Semiconductor Inc. reported revenue of $1.76 billion in its last reported quarter. This represents a -19.2% year-over-year change. EPS for the same period was $0.99, compared to $1.39 a year ago.
The reported revenue was a surprise of +0.7% when compared to the Zacks Consensus Estimate of $1.75 billion. EPS surprise was +2.06%.
The company beat consensus EPS estimates in each of the trailing four quarters. The company has surpassed consensus revenue estimates every time during this period.
You cannot make efficient investment decisions without considering stock valuation. To predict a stock’s future price performance, it is important to determine whether the current price accurately reflects the intrinsic value of the underlying business and the company’s growth prospects.
The present value of a company’s valuation multiples such as price-to-earnings (P/E), price-to-sales (P/S), and price-to-cash flow (P/CF), as well as the company’s past value, are Comparing a company to its peers based on these parameters will help you see how reasonable its stock price is. You can get to know better.
As part of the Zacks Style Scores system, the Zacks Value Style Score (which evaluates both traditional and unconventional valuation metrics) categorizes stocks into five groups, ranging from A to F, with A being B B is better than C, and so on), and can help identify whether a stock is overvalued, fairly valued, or temporarily undervalued. Masu.
ON Semiconductor is rated C on this score, indicating it performs on par with its peers. Click here to see the values of some of the metrics that determined this grade.
The facts discussed here, and much of the other information on Zacks.com, may help you decide whether the market buzz regarding ON Semiconductor, Inc. is worth paying attention to. However, the company’s Zacks Rank #4 suggests the company could underperform the broader market in the near term. semester.
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