NASDAQ:ON is a prime example of a stock that offers more than what meets the eye in terms of fundamentals.

Last update: Jan 21, 2025

Discover ON SEMICONDUCTOR (NASDAQ:ON)—an undervalued stock our stock screener has picked out. NASDAQ:ON demonstrates solid fundamentals, including health and profitability, all while staying attractively priced. Let's explore the details.

Valuation Examination for NASDAQ:ON

ChartMill employs its own Valuation Rating system for all stocks. This score, ranging from 0 to 10, is determined by evaluating different valuation factors, including price to earnings and free cash flow, both in absolute terms and relative to the market and industry. NASDAQ:ON has earned a 7 for valuation:

Based on the Price/Earnings ratio, ON is valued cheaper than 93.52% of the companies in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 27.94, ON is valued rather cheaply.
Based on the Price/Forward Earnings ratio, ON is valued cheaper than 92.59% of the companies in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 24.11. ON is valued slightly cheaper when compared to this.
91.67% of the companies in the same industry are more expensive than ON, based on the Enterprise Value to EBITDA ratio.
83.33% of the companies in the same industry are more expensive than ON, based on the Price/Free Cash Flow ratio.
The excellent profitability rating of ON may justify a higher PE ratio.

Exploring NASDAQ:ON's Profitability

ChartMill assigns a Profitability Rating to every stock. This score ranges from 0 to 10 and evaluates the different profitability ratios and margins, both absolutely, but also relative to the industry peers. NASDAQ:ON scores a 9 out of 10:

ON has a better Return On Assets (12.61%) than 78.70% of its industry peers.
ON has a Return On Equity of 20.45%. This is amongst the best in the industry. ON outperforms 85.19% of its industry peers.
ON's Return On Invested Capital of 14.75% is amongst the best of the industry. ON outperforms 85.19% of its industry peers.
ON had an Average Return On Invested Capital over the past 3 years of 19.02%. This is significantly above the industry average of 11.96%.
The last Return On Invested Capital (14.75%) for ON is well below the 3 year average (19.02%), which needs to be investigated, but indicates that ON had better years and this may not be a problem.
The Profit Margin of ON (23.80%) is better than 84.26% of its industry peers.
ON's Profit Margin has improved in the last couple of years.
With an excellent Operating Margin value of 28.27%, ON belongs to the best of the industry, outperforming 87.96% of the companies in the same industry.
ON's Operating Margin has improved in the last couple of years.
ON's Gross Margin has improved in the last couple of years.

Evaluating Health: NASDAQ:ON

A critical element of ChartMill's stock evaluation is the Health Rating, which spans from 0 to 10. This rating considers multiple health factors, including liquidity and solvency, both in absolute terms and relative to industry peers. NASDAQ:ON has received a 6 out of 10:

An Altman-Z score of 4.80 indicates that ON is not in any danger for bankruptcy at the moment.
The Debt to FCF ratio of ON is 3.37, which is a good value as it means it would take ON, 3.37 years of fcf income to pay off all of its debts.
ON has a better Debt to FCF ratio (3.37) than 66.67% of its industry peers.
A Debt/Equity ratio of 0.30 indicates that ON is not too dependend on debt financing.
ON has a Current Ratio of 3.07. This indicates that ON is financially healthy and has no problem in meeting its short term obligations.
ON has a Quick Ratio of 2.02. This indicates that ON is financially healthy and has no problem in meeting its short term obligations.

ChartMill's Evaluation of Growth

ChartMill assigns a Growth Rating to every stock. This score ranges from 0 to 10 and evaluates the different growth aspects like EPS and Revenue, both in the past as in the future. NASDAQ:ON scores a 4 out of 10:

ON shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 21.36% yearly.
The Earnings Per Share is expected to grow by 12.49% on average over the next years. This is quite good.

Every day, new Decent Value stocks can be found on ChartMill in our Decent Value screener.

Check the latest full fundamental report of ON for a complete fundamental analysis.

Keep in mind

This article should in no way be interpreted as advice. The article is based on the observed metrics at the time of writing, but you should always make your own analysis and trade or invest at your own responsibility.