ON Semiconductor (ON) Is Today's Dead Cat Bounce Stock
Trade-Ideas LLC identified
(
) as a "dead cat bounce" (down big yesterday but up big today) candidate. In addition to specific proprietary factors, Trade-Ideas identified ON Semiconductor as such a stock due to the following factors:
- ON has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $70.2 million.
- ON has traded 254,489 shares today.
- ON is up 4.4% today.
- ON was down 7.9% yesterday.
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More details on ON:
ON Semiconductor Corporation manufactures and sells semiconductor components for various electronic devices worldwide. It operates in four segments: Application Products Group, Image Sensor Group, Standard Products Group, and System Solutions Group. ON has a PE ratio of 3. Currently there are 10 analysts that rate ON Semiconductor a buy, 1 analyst rates it a sell, and 4 rate it a hold.
The average volume for ON Semiconductor has been 5.1 million shares per day over the past 30 days. ON Semiconductor has a market cap of $4.4 billion and is part of the technology sector and electronics industry. The stock has a beta of 1.86 and a short float of 3.3% with 2.07 days to cover. Shares are up 6% year-to-date as of the close of trading on Tuesday.
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Analysis:
rates ON Semiconductor as a
. The company's strengths can be seen in multiple areas, such as its revenue growth, solid stock price performance and growth in earnings per share. However, as a counter to these strengths, we find that the company's return on equity has been disappointing.
Highlights from the ratings report include:
- The revenue growth came in higher than the industry average of 10.8%. Since the same quarter one year prior, revenues slightly increased by 8.5%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- Investors have apparently begun to recognize positive factors similar to those we have mentioned in this report, including earnings growth. This has helped drive up the company's shares by a sharp 30.88% over the past year, a rise that has exceeded that of the S&P 500 Index. Regarding the stock's future course, our hold rating indicates that we do not recommend additional investment in this stock despite its gains in the past year.
- 40.27% is the gross profit margin for ON SEMICONDUCTOR CORP which we consider to be strong. Regardless of ON's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, ON's net profit margin of 5.12% is significantly lower than the industry average.
- ON's debt-to-equity ratio of 0.90 is somewhat low overall, but it is high when compared to the industry average, implying that the management of the debt levels should be evaluated further. Regardless of the somewhat mixed results with the debt-to-equity ratio, the company's quick ratio of 0.86 is weak.
- The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. In comparison to the other companies in the Semiconductors & Semiconductor Equipment industry and the overall market, ON SEMICONDUCTOR CORP's return on equity is significantly below that of the industry average and is below that of the S&P 500.
- You can view the full ON Semiconductor Ratings Report.
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