Vivek Arya, an analyst from Bank of America Securities, reiterated the Hold rating on ON Semiconductor. The associated price target remains the same with $62.00.
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Vivek Arya’s rating is based on a combination of factors that suggest a cautious outlook for ON Semiconductor. The recent shortages at Nexperia, a China-owned auto discrete chip vendor, are seen as a potential short-term catalyst for ON Semiconductor, but the impact may not be sustainable. While ON Semiconductor is the most exposed to these shortages, the company has been moving away from its low-end discrete portfolio, which raises questions about its willingness to requalify parts to address these shortages.
Additionally, ON Semiconductor has been losing market share in the small-signal discrete segment to Nexperia, which has shown significant growth. Despite ON’s relatively lower valuation and potential opportunities in the data center power market, Arya maintains a Hold rating due to the need for stronger signs of recovery in the automotive market and ON’s strategic adjustments. The price objective has been raised to $62, reflecting a cautious optimism, but the Neutral stance remains until more definitive positive trends are observed.
In another report released on October 14, TR | OpenAI – 4o also reiterated a Hold rating on the stock with a $55.00 price target.