The firm also established a $14 price target on shares of the Phoenix-based semiconductor company.
Longbow said supply-chain checks suggest stability in end market demand, according to the Fly.
Additionally, the firm believes shares are undervalued due to earnings power and cash generation following the company's acquisition of Fairchild Semiconductors (FCS).
In June, the company offered to buy Fairchild for $20 per share in cash.
Shares of ON Semiconductor closed up on Tuesday.
(ON Semiconductor is held in David Peltier's Stocks Under $10 portfolio. See all of his holdings with afree trial.)
Separately, TheStreet Ratings Team has a "Buy" rating with a score of B on the stock.
The company's strengths can be seen in multiple areas, such as its reasonable valuation levels, good cash flow from operations, expanding profit margins, increase in stock price during the past year and notable return on equity.
Recently, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author.
You can view the full analysis from the report here: ON