From Nasdaq: 2024-08-03 18:30:00

ON Semiconductor’s Q2 earnings report drove its stock up 14.2%, outperforming Nvidia. The company serves cyclical markets including automotive and industrial sectors. Although revenue has been declining, the midpoint of Q3 guidance hints at a potential sequential increase. Despite challenges, investors see long-term growth potential and ON Semiconductor’s attractive valuation.

CEO forecasts an “L-shaped” recovery, with end markets deteriorating in 2024 due to high interest rates impacting car sales and industrial automation demand. Despite uncertainty, ON Semiconductor secures a deal with Volkswagen and positions itself in the EV market. The company’s valuation remains enticing at 18.6 times earnings estimate for 2024.

Investors may find ON Semiconductor’s potential attractive for long-term growth, despite near-term uncertainties. The company is set to benefit from a future shift towards EVs and industrial automation. With key partnerships in place and a solid valuation, ON Semiconductor may continue to outperform market expectations.



Read more at Nasdaq: Can This Hot Semiconductor Stock Keep Outperforming Nvidia?