For most investors, how much a stock's price changes over time is important. Not only can it impact your investment portfolio, but it can also help you compare investment results across sectors and industries.
FOMO, or the fear of missing out, also plays a role in investing, particularly with tech giants and popular consumer-facing stocks.
What if you'd invested in ON Semiconductor Corp. (ON) ten years ago? It may not have been easy to hold on to ON for all that time, but if you did, how much would your investment be worth today?
ON Semiconductor Corp.'s Business In-Depth
With that in mind, let's take a look at ON Semiconductor Corp.'s main business drivers.
Phoenix, AZ-based ON Semiconductor Corporation is an original equipment manufacturer (OEM) of a broad range of discrete and embedded semiconductor components. The company was spun off from Motorola in Aug 1999 and went public through an IPO in May 2000.
ON Semi’s product lines include discretes, such as bipolar transistors, diodes, filters, FETs, rectifiers and thyristors.
ON Semi’s acquisition of Fairchild Semiconductor International makes it a leader in the power semiconductor space. Moreover, the company’s acquisitions of Cypress Semiconductor’s CMOS Image Sensor Business Unit, SANYO Semiconductor, AMI Semiconductor, Analog Devices’ power PC controller business, CMD, Catalyst, and SoundDesign gave it new technical capabilities, some custom ASIC products, higher-margin products, exposure to new end markets and greater product breadth.
The power management product line includes AC-DC controllers and regulators, DC-DC converters and regulators, drivers, thermal managers, and voltage controllers, references and supervisors.
The logic product line includes clocking, memory, differential logic and standard logic products.
Signal processing products include amplifiers and comparators, analog switches, digital potentiometers, DSP systems and interfaces.
The company also offers custom application specific integrated circuits (ASICs), foundry services and memory products.
Customers include OEMs, electronic manufacturing service (EMS) providers and distributors. Top OEM customers include Motorola, Delta, Hewlett-Packard, Samsung, Siemens, Apple, Dell, Nokia, Intel, Sony, Continental Automotive Systems, DaimlerChrysler, Delphi, TRW and Visteon.
Top distributor customers include Arrow, Avnet, EBV Elektronik, Future, Solomon Enterprise and World Peace. Top EMS customers are Flextronics, Jabil and Celestica.
In 2020, ON Semiconductor reported revenues of $5.255 billion. ON Semi generated 13.9% of total revenues in 2020 from the United States.
Putting together a successful investment portfolio takes a combination of research, patience, and a little bit of risk. For ON Semiconductor Corp. if you bought shares a decade ago, you're likely feeling really good about your investment today.
A $1000 investment made in April 2011 would be worth $4,424.30, or a gain of 342.43%, as of April 12, 2021, according to our calculations. This return excludes dividends but includes price appreciation.
In comparison, the S&P 500 gained 210.86% and the price of gold went up 15.30% over the same time frame.
Looking ahead, analysts are expecting more upside for ON.
ON Semiconductor is benefitting from a recovering global macroeconomic environment, especially automotive end market. The company is well-positioned to gain from solid momentum witnessed in image sensors amid consistent growth in advanced driver-assistance systems (“ADAS”) domain. Further, strong traction for silicon carbide (SiC) and silicon power products driven by growth in electric vehicles (EVs) augurs well. The company is witnessing increasing demand for its LiDAR solutions along with ultrasonic, lighting and actuator offerings. Also, healthy growth in the 5G infrastructure business favors prospects. Notably, shares of the company have outperformed the industry in the past year. Nonetheless, a highly leveraged balance sheet and susceptibility to forex headwinds due to sizeable international market exposure are persistent overhangs.
The stock is up 10.72% over the past four weeks, and no earnings estimate has gone lower in the past two months, compared to 2 higher, for fiscal 2021. The consensus estimate has moved up as well.
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