2024-07-03 09:00:00 ET
Summary
- ON remains a compelling Buy, thanks to its design wins across the top Chinese OEMs in the automotive and energy storage/ renewable end markets.
- The robust LTSAs continue to offer great insights into its near-term prospects, further aided by the intermediate opportunities in the hybrid drivetrains and onboard chargers.
- For now, ON has unfortunately missed the data center/ AI boat, with IFNNY already reporting "design wins across AI processor makers and global hyperscalers."
- Even so, the market may be large enough to accommodate multiple players, especially aided by the intensified sampling and new product launches.
- While its near-term prospects may be uncertain, we remain confident about ON's eventual turnabout with the electrification market bound to recover over the next few years.
ON's Stable Valuations Offer Interested Investors With Improved Margin Of Safety
We previously covered ON Semiconductor Corporation ( ON ) in March 2024, discussing why we had maintained our Buy rating given its promising FQ4'23 performance....
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For further details see:
ON Semiconductor Q2 Preview: Left Behind By The Generative AI Rally - Reiterate Cautious Buy