Skip to main content

Market Overview

ON Semiconductor Lowered From Outperform To Underperform At Credit Suisse

ON Semiconductor Lowered From Outperform To Underperform At Credit Suisse

ON Semiconductor Corp (NASDAQ: ON) has successfully completed its acquisition of Fairchild Semiconductor International, Inc. (Nasdaq: FCS). Since then, ON Semiconductor’s shares have risen 35 percent, outperforming the broader group by ~10 percentage points, Credit Suisse’s John W. Pitzer said in a report.

Pitzer downgrades the rating on the company from Outperform to Underperform, while reducing the price target from $17.50 to $13.50. He mentioned that although there is upside to the company’s Q1 and Q2 results, the stock is already trading at a high valuation. Moreover, with year-over-year Industry growth expected to peak by June, “we see shares at least fully valued.”

Historical Trends Indicate Downside

Stocks of the individual companies, ON Semiconductor and Fairchild, have historically underperformed following a year-over-year revenue peak, the analyst noted.

While expressing optimism regarding the prospects of the semiconductor segment, Pitzer mentioned that against the backdrop of a cyclical peak, he preferred the stocks of Texas Instruments Incorporated (NASDAQ: TXN), Analog Devices, Inc. (NASDAQ: ADI) and Microchip Technology Inc. (NASDAQ: MCHP).

“Although C1Q/C2Q earnings likely a positive catalyst, albeit somewhat obfuscated by a change to sell-in Rev recognition (our downgrade is perhaps early), we see higher quality assets at similar multiples with better risk/reward,” the analyst commented.

Related Links:

Vetr Downgrades ON Semiconductor To Sell

ON Semiconductor Sinks After Downgrade

Latest Ratings for ON

Feb 2021Truist SecuritiesMaintainsBuy
Feb 2021MizuhoMaintainsBuy
Feb 2021Deutsche BankMaintainsBuy

View More Analyst Ratings for ON
View the Latest Analyst Ratings


Related Articles (FCS + ON)

View Comments and Join the Discussion!

Posted-In: Analyst Color News Short Ideas Downgrades Price Target Analyst Ratings Movers Tech Best of Benzinga

Latest Ratings

ICADGuggenheimInitiates Coverage On24.0
SMBKRaymond JamesUpgrades27.0
View the Latest Analytics Ratings
Don't Miss Any Updates!
News Directly in Your Inbox
Subscribe to:
Benzinga Premarket Activity
Get pre-market outlook, mid-day update and after-market roundup emails in your inbox.
Market in 5 Minutes
Everything you need to know about the market - quick & easy.
Fintech Focus
A daily collection of all things fintech, interesting developments and market updates.
Everything you need to know about the latest SPAC news.
Thank You

Thank you for subscribing! If you have any questions feel free to call us at 1-877-440-ZING or email us at