Let’s talk about the popular ON Semiconductor Corporation (NASDAQ:ON). The company’s stock has received a lot of attention due to its significant price movement on the NASDAQGS over the past few months, rising to as high as $77.87 at one point before falling to a low of $66.39. Depending on stock price movements, investors may have a better opportunity to enter a stock and may be able to buy at a lower price. The question to answer is whether ON Semiconductor’s current trading price of $68.49 reflects the actual value of the large-cap stock. Or is it currently undervalued, providing a buying opportunity? Let’s take a look at ON Semiconductor’s outlook and value based on the latest financial data and see if there are any catalysts for price movement.
Check out our latest analysis for ON Semiconductor.
Is ON Semiconductor still cheap?
Good news for investors – ON Semiconductor is still trading at a fairly low price, according to our price multiple model, which compares the company’s price-to-earnings ratio to the industry average. In this example, we used the price-to-earnings ratio (PE) given that there is not enough information to reliably predict a stock’s cash flows. ON Semiconductor’s multiple of 16.61x is lower than its peer average of 30.33x, indicating that the stock is trading cheaply relative to the Semiconductor industry. However, given that ON Semiconductor’s stock price is quite volatile (i.e., it has large price swings relative to the rest of the market), the price could fall, giving it another chance to buy in the future. may be given. This is based on its high beta value, which is a good indicator of stock price volatility.
What kind of growth will ON Semiconductor bring?
Future outlook is an important aspect when considering buying a stock, especially for investors looking for growth in their portfolio. While value investors would argue that it’s the intrinsic value relative to the price that matters most, a more compelling investment thesis would be high growth potential at a cheap price. With profits expected to grow by 51% over the next few years, the future looks bright for ON Semiconductor. It appears that cash flow is expected to increase, which should lead to a higher stock valuation.
what this means to you
Are you a shareholder? Since ON currently trades below its industry P/E ratio, now may be a great time to increase your holdings in the stock. Despite the positive outlook, it seems like this growth is not yet fully factored into the stock price. However, there are other factors to consider, such as financial health, which may explain the current price multiple.
Are you a potential investor? If you’ve been eyeing ON for a while, now might be the time to get into the stock. Its strong future earnings outlook is not yet fully reflected in the current share price, but that means it’s not too late to buy ON. However, to make an informed assessment, consider other factors, such as the management team’s track record, before making any investment decisions.
Digging deeper into ON Semiconductor’s forecasts above can help you understand how analysts see the stock going forward. At Simply Wall St, click here to see analyst forecasts.
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This article by Simply Wall St is general in nature. We provide commentary using only unbiased methodologies, based on historical data and analyst forecasts, and articles are not intended to be financial advice. This is not a recommendation to buy or sell any stock, and does not take into account your objectives or financial situation. We aim to provide long-term, focused analysis based on fundamental data. Note that our analysis may not factor in the latest announcements or qualitative material from price-sensitive companies. Simply Wall St has no position in any stocks mentioned.
