ON Semiconductor Earnings: What To Look For From ON

Radek Strnad /
2022/05/02 4:01 am EDT
Add to Watchlist

Analog chips maker ON Semiconductor (NASDAQ: ON) will be announcing earnings results today before market hours. Here's what investors should know.

Last quarter ON Semiconductor reported revenues of $1.84 billion, up 27.6% year on year, beating analyst revenue expectations by 3.08%. It was an impressive quarter for the company, with a significant improvement in gross margin and a beat on the bottom line.

Is ON Semiconductor buy or sell heading into the earnings? Read our full analysis here, it's free.

This quarter analysts are expecting ON Semiconductor's revenue to grow 28.6% year on year to $1.9 billion, improving on the 15.9% year-over-year increase in revenue the company had recorded in the same quarter last year. Adjusted earnings are expected to come in at $1.05 per share.

ON Semiconductor Total Revenue

The analysts covering the company have had mixed opinions about the business heading into the earnings, with revenue estimates seeing two upward and one downward revision over the last thirty days. The company only missed Wall St's revenue estimates once over the last two years, and has on average exceeded top line expectations by 2.58%.

Looking at ON Semiconductor's peers in the analog semiconductors segment, some of them have already reported Q1 earnings results, giving us a hint of what we can expect. Texas Instruments delivered top-line growth of 14.3% year on year, beating analyst estimates by 3.65% and Sensata Technologies reported revenues up 3.52% year on year, exceeding estimates by 1.57%. Texas Instruments traded down 7.5% on the results, Sensata Technologies was flat on the results. Read our full analysis of Texas Instruments's results here and Sensata Technologies's results here.

Tech stocks have been under pressure since the end of last year and while some of the analog semiconductors stocks have fared somewhat better, they have not been spared, with share price declining 12.7% over the last month. ON Semiconductor is down 15.3% during the same time, and is heading into the earnings with analyst price target of $72.8, compared to share price of $53.11.

One way to find opportunities in the market is to watch for generational shifts in the economy. Almost every company is slowly finding itself becoming a technology company and facing cybersecurity risks and as a result, the demand for cloud-native cybersecurity is skyrocketing. This company is leading a massive technological shift in the industry and with revenue growth of 70% year on year and best-in-class SaaS metrics it should definitely be on your radar.

The author has no position in any of the stocks mentioned.