NEW YORK (TheStreet) -- Shares of ON Semiconductor (ONNN) were gaining 6% to $12.74 Thursday after the semiconductor supplier announced the successful demonstration of its new technology that can enable faster autofocus in smartphone cameras.
The company's new Phase Detect Auto Focus (PDAF) technology uses a unique pixel micro-lens to enable fast auto focus at 25 Lux light levels, or similar to a dimly-lit room, according to the company. ON Semiconductor said it successfully implemented the technology on a 13 megapixel test chip with 1.1 micron pixels.
PDAF technology uses two pixels to measure phase information about a target image, and can calculate the amount the lens of a smartphone camera needs to move to focus in less than 0.3 seconds, depending on the focus actuator speed, according to ON Semiconductor. Traditional smartphone autofocus algorithms can take over 1.2 seconds, according to the company.
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"ON Semiconductor's PDAF technology is the result of innovations in both pixel and optical stack design," Shung Chieh, vice president, Mobile and Consumer Division for ON Semiconductor said. "The outcome is a reduction of auto focus time by nearly a factor of four and delivers a great experience to the mobile device user. The leading low-light capability of our technology enables smartphone manufacturers to deliver a fast AF experience across all light levels to their customers."
ON Semiconductor said the new technology will be used in a new product for mobile end-market customers later this year.
TheStreet Ratings team rates ON SEMICONDUCTOR CORP as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:
"We rate ON SEMICONDUCTOR CORP (ONNN) a BUY. This is driven by some important positives, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its revenue growth, solid stock price performance, good cash flow from operations, expanding profit margins and largely solid financial position with reasonable debt levels by most measures. We feel these strengths outweigh the fact that the company has had sub par growth in net income."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The revenue growth came in higher than the industry average of 10.1%. Since the same quarter one year prior, revenues rose by 20.4%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
- Compared to its closing price of one year ago, ONNN's share price has jumped by 25.89%, exceeding the performance of the broader market during that same time frame. Regarding the stock's future course, although almost any stock can fall in a broad market decline, ONNN should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
- Net operating cash flow has increased to $162.50 million or 27.95% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of -17.16%.
- 40.28% is the gross profit margin for ON SEMICONDUCTOR CORP which we consider to be strong. It has increased from the same quarter the previous year. Despite the strong results of the gross profit margin, ONNN's net profit margin of 0.56% significantly trails the industry average.
- ON SEMICONDUCTOR CORP has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, ON SEMICONDUCTOR CORP increased its bottom line by earning $0.43 versus $0.33 in the prior year. This year, the market expects an improvement in earnings ($0.92 versus $0.43).
- You can view the full analysis from the report here: ONNN Ratings Report