Key Highlights
- Shares of ON Semiconductor reached a fresh 52-week peak at $99.64, marking a 145% gain year-over-year
- B. Riley shifted its rating to Buy and increased the price target from $64 to $115
- Analyst Craig Ellis sees the cyclical bottom now in the rearview mirror
- First quarter 2026 earnings scheduled for May 4, with revenue guidance of $1.435B–$1.535B
- Lead times for Onsemi MOSFET products have stretched to 26 weeks according to Baird analysis
ON Semiconductor shares have experienced remarkable momentum recently. The chipmaker’s stock reached $99.64 this week, marking a fresh 52-week peak and extending a powerful rally that has delivered 145% gains over the trailing twelve months.
ON Semiconductor Corporation, ON
The rally gained additional fuel as B. Riley analyst Craig Ellis elevated his rating on ON to Buy from Neutral, while dramatically increasing the firm’s price objective from $64 to $115.
Ellis issued the upgrade just ahead of ON’s first quarter 2026 financial results, scheduled for release on May 4. His investment thesis centers on the view that the cyclical headwinds have subsided, and the company’s strategic emphasis on power management chips, silicon carbide solutions for electric vehicles, and industrial automation technologies sets it up favorably for the coming recovery phase.
This upgrade represents one of the most bullish stance adjustments on a domestic semiconductor manufacturer this season. Shares were changing hands near $98 during intraday trading when the analyst call was published.
BofA Securities similarly elevated ON to Buy status recently, highlighting the company’s artificial intelligence product capabilities, its Treo platform offerings, and a freshly approved $6 billion stock repurchase authorization extending across three years.
CEO Hassane El-Khoury has indicated the company is observing “increasing signs of stabilization” across its primary end markets, commentary that reinforces the optimistic narrative analysts are now embracing.
Financial Performance and Outlook
Fiscal year 2025 revenue totaled $5.995 billion, representing a 15% decline compared to the prior year. However, despite the top-line contraction, the company generated a record $1.418 billion in free cash flow during the period.
Management’s guidance for the first quarter of 2026 projects revenue in the range of $1.435 billion to $1.535 billion, accompanied by earnings per share between $0.56 and $0.66. These figures point toward sequential stabilization, the very signal market participants have been anticipating.
The shares currently trade at a trailing price-to-earnings multiple of 307x, which appears elevated. However, the forward P/E ratio of 31x captures the earnings rebound that Wall Street is forecasting.
The company’s market capitalization stands near $35 billion. Analyst sentiment remains divided: 11 firms maintain Buy recommendations while 23 rate the stock at Hold.
InvestingPro analysis indicates the shares are trading above their Fair Value calculation, positioning ON among the market’s most richly valued securities at present.
Supply Dynamics Turning Favorable
Another positive catalyst is emerging beneath the surface. Baird’s research indicates that semiconductor lead times are expanding across various product categories.
Industry-wide MOSFET lead times are averaging 25 weeks currently. For Onsemi-branded MOSFETs specifically, lead times have extended to 26 weeks — evidence that order activity is accelerating beyond available supply capacity.
This type of supply constraint typically supports improved pricing dynamics, which would assist margin expansion from the 38% non-GAAP gross margin low point the company experienced during the previous downturn.
Challenges persist nevertheless. Barclays highlighted ON’s significant concentration in automotive and Chinese markets when establishing coverage at Equal-Weight.
Insider transactions warrant monitoring as well. CFO stock sales during April introduce a cautionary element to an otherwise constructive technical picture.
Market attention now shifts to May 4, when ON Semiconductor unveils its Q1 2026 financial performance. The quarterly release will serve as the initial validation point for whether the stabilization narrative materializes as expected.
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