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ON Semiconductor Corp. (ON) Down 5.2% Since Last Earnings Report: Can It Rebound?
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It has been about a month since the last earnings report for ON Semiconductor Corp. (ON - Free Report) . Shares have lost about 5.2% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is ON Semiconductor Corp. due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.
ON Semiconductor Q3 Earnings Beat Estimates: Will Raised View Aid Shares?
ON Semiconductor reported third-quarter 2024 non-GAAP earnings of 99 cents per share, which outpaced the Zacks Consensus Estimate by 2.06% but declined 28.8% year over year.
Revenues of $1.76 billion beat the Zacks Consensus Estimate by 0.7% but declined 19.2% on a year-over-year basis.
ON’s Top-Line Details
Power Solutions Group revenues of $829.4 million (contributed 47.1% to revenues) fell 23% year over year. The figure missed the Zacks Consensus Estimate by 1.45%.
Analog & Mixed Group revenues of $653.7 million (37.1% of revenues) declined 15.7% on a year-over-year basis. The figure beat the consensus mark by 0.71%.
Intelligent Sensing Group revenues of $278.8 million (15.8% of revenues) fell 15.2% year over year. The figure beat the consensus mark by 7.46%.
In terms of end markets, Automotive (54% of revenues) revenues were $951.2 million, down 17.8% year over year. The figure beat the Zacks Consensus Estimate by 2.16%.
Industrial (25% of revenues) end-market (including military, aerospace and medical) revenues declined 28.6% year over year to $440 million. The figure missed the consensus mark by 5.39%.
Others (21% of revenues) end-market revenues declined 8.9% year over year to $371 million. The figure beat the consensus mark by 4.47%.
In the third quarter, ON Semiconductor introduced EliteSiC M3e MOSFETs, which significantly improve efficiency for power-hungry applications.
ON’s Operating Details
Non-GAAP gross margin contracted 180 basis points (bps) year over year to 45.5%.
Non-GAAP operating expenses decreased 5.5% year over year to $304.5 million.
Non-GAAP operating margin was 28.2%, down 440 bps on a year-over-year basis.
ON’s Balance Sheet & Cash Flow
As of Sept. 27, 2024, onsemi had cash and cash equivalents of $2.47 billion compared with $2.23 billion as of June 28, 2024.
Total debt (including the current portion), as of Sept. 27, 2024, was $3.34 billion, unchanged sequentially.
Third-quarter 2024 cash flow from operations amounted to $465.8 million compared with the previous quarter’s reported figure of $362.2 million.
Free cash flow amounted to $293.6 million compared with free cash flow of $207.7 million in the previous quarter.
ON Raises Q4 Guidance
For the fourth quarter of 2024, onsemi expects revenues between $1.71 billion and $1.81 billion.
Non-GAAP gross margin is projected to be in the range of 44-46%.
Non-GAAP operating expenses are expected to be in the range of $300-$315 million.
Non-GAAP earnings are envisioned between 92 cents per share and 1.04 cents.
How Have Estimates Been Moving Since Then?
It turns out, estimates review have trended downward during the past month.
VGM Scores
Currently, ON Semiconductor Corp. has a poor Growth Score of F, however its Momentum Score is doing a bit better with a D. Charting a somewhat similar path, the stock was allocated a grade of C on the value side, putting it in the middle 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, ON Semiconductor Corp. has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
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ON Semiconductor Corp. (ON) Down 5.2% Since Last Earnings Report: Can It Rebound?
It has been about a month since the last earnings report for ON Semiconductor Corp. (ON - Free Report) . Shares have lost about 5.2% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is ON Semiconductor Corp. due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.
ON Semiconductor Q3 Earnings Beat Estimates: Will Raised View Aid Shares?
ON Semiconductor reported third-quarter 2024 non-GAAP earnings of 99 cents per share, which outpaced the Zacks Consensus Estimate by 2.06% but declined 28.8% year over year.
Revenues of $1.76 billion beat the Zacks Consensus Estimate by 0.7% but declined 19.2% on a year-over-year basis.
ON’s Top-Line Details
Power Solutions Group revenues of $829.4 million (contributed 47.1% to revenues) fell 23% year over year. The figure missed the Zacks Consensus Estimate by 1.45%.
Analog & Mixed Group revenues of $653.7 million (37.1% of revenues) declined 15.7% on a year-over-year basis. The figure beat the consensus mark by 0.71%.
Intelligent Sensing Group revenues of $278.8 million (15.8% of revenues) fell 15.2% year over year. The figure beat the consensus mark by 7.46%.
In terms of end markets, Automotive (54% of revenues) revenues were $951.2 million, down 17.8% year over year. The figure beat the Zacks Consensus Estimate by 2.16%.
Industrial (25% of revenues) end-market (including military, aerospace and medical) revenues declined 28.6% year over year to $440 million. The figure missed the consensus mark by 5.39%.
Others (21% of revenues) end-market revenues declined 8.9% year over year to $371 million. The figure beat the consensus mark by 4.47%.
In the third quarter, ON Semiconductor introduced EliteSiC M3e MOSFETs, which significantly improve efficiency for power-hungry applications.
ON’s Operating Details
Non-GAAP gross margin contracted 180 basis points (bps) year over year to 45.5%.
Non-GAAP operating expenses decreased 5.5% year over year to $304.5 million.
Non-GAAP operating margin was 28.2%, down 440 bps on a year-over-year basis.
ON’s Balance Sheet & Cash Flow
As of Sept. 27, 2024, onsemi had cash and cash equivalents of $2.47 billion compared with $2.23 billion as of June 28, 2024.
Total debt (including the current portion), as of Sept. 27, 2024, was $3.34 billion, unchanged sequentially.
Third-quarter 2024 cash flow from operations amounted to $465.8 million compared with the previous quarter’s reported figure of $362.2 million.
Free cash flow amounted to $293.6 million compared with free cash flow of $207.7 million in the previous quarter.
ON Raises Q4 Guidance
For the fourth quarter of 2024, onsemi expects revenues between $1.71 billion and $1.81 billion.
Non-GAAP gross margin is projected to be in the range of 44-46%.
Non-GAAP operating expenses are expected to be in the range of $300-$315 million.
Non-GAAP earnings are envisioned between 92 cents per share and 1.04 cents.
How Have Estimates Been Moving Since Then?
It turns out, estimates review have trended downward during the past month.
VGM Scores
Currently, ON Semiconductor Corp. has a poor Growth Score of F, however its Momentum Score is doing a bit better with a D. Charting a somewhat similar path, the stock was allocated a grade of C on the value side, putting it in the middle 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, ON Semiconductor Corp. has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.