Today's Water-Logged And Getting Wetter Stock: ON Semiconductor (ON)
Trade-Ideas LLC identified
(
) as a "water-logged and getting wetter" (weak stocks crossing below support with today's range greater than 200%) 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 $41.4 million.
- ON has traded 12.0 million shares today.
- ON traded in a range 206.8% of the normal price range with a price range of $0.84.
- ON traded below its daily resistance level (quality: 46 days, meaning that the stock is crossing a resistance level set by the last 46 calendar days. The resistance price is defined by the Price - $0.01 at the time of the signal).
Stocks matching the 'Water-Logged and Getting Wetter' criteria are worthwhile stocks to watch for a variety of factors including historical back testing and volatility. Trade-Ideas targets these opportunities because the stock is exhibiting an unusual behavior while displaying negative price action. In this case, the stock crossed an important inflection point; namely, "support" while at the same time the range of the stock's movement in price is twice its normal size. This large range foreshadows a possible continuation as the stock moves lower.
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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 3.25 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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