Is ON Semiconductor Stock a Hidden Value Opportunity Amid Chip Industry Challenges?
Tuesday, 14 May 2024, 13:45
Overview
ON Semiconductor, known for silicon carbide power chips, is tackling revenue downturns with a focus on high-profit chips. The company anticipates challenges due to EV sales slowdown but is strategically positioning for long-term growth.
Strategic Shift
CEO Hassane El-Khoury is leading a shift towards advanced chips like SiC chips and image sensors, enhancing profitability despite slower revenue growth.
Industry Challenges
- The chip industry is facing a cyclical downturn, impacting revenue and EPS for ON Semiconductor.
- Market conditions, including a slowdown in EV sales, are affecting chip suppliers like ON Semiconductor.
Future Outlook
ON Semiconductor projects steady revenue growth and higher free cash flow margins, underlining long-term potential.
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