Trade-Ideas LLC identified

ON Semiconductor

(

ON

) as a "barbarian at the gate" (strong stocks crossing above resistance 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 $27.0 million.
  • ON has traded 3.4 million shares today.
  • ON traded in a range 210.9% of the normal price range with a price range of $0.56.
  • ON traded above its daily resistance level (quality: 84 days, meaning that the stock is crossing a resistance level set by the last 84 calendar days. The resistance price is defined by the Price - $0.01 at the time of the signal).

Stocks matching the 'Barbarian at the Gate' 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 positive price action. In this case, the stock crossed an important inflection point; namely, 'resistance' while at the same time the range of the stock's movement in price is more than twice its normal size. This large range foreshadows a possible continuation as the stock moves higher.

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More details on ON:

ON Semiconductor Corporation manufactures and sells semiconductor components for various electronic devices worldwide. ON has a PE ratio of 19. Currently there are 8 analysts that rate ON Semiconductor a buy, 1 analyst rates it a sell, and 3 rate it a hold.

The average volume for ON Semiconductor has been 4.8 million shares per day over the past 30 days. ON Semiconductor has a market cap of $3.9 billion and is part of the technology sector and electronics industry. The stock has a beta of 1.95 and a short float of 2.2% with 3.36 days to cover. Shares are down 4% year-to-date as of the close of trading on Monday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates ON Semiconductor as a

hold

. The company's strengths can be seen in multiple areas, such as its increase in net income, reasonable valuation levels and notable return on equity. However, as a counter to these strengths, we find that we feel that the company's cash flow from its operations has been weak overall.

Highlights from the ratings report include:

  • ON SEMICONDUCTOR CORP has shown improvement in its earnings for its most recently reported quarter when compared with the same quarter a year earlier. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. This trend suggests that the performance of the business is improving. During the past fiscal year, ON SEMICONDUCTOR CORP increased its bottom line by earning $0.49 versus $0.43 in the prior year. This year, the market expects an improvement in earnings ($0.81 versus $0.49).
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Semiconductors & Semiconductor Equipment industry. The net income increased by 9116.7% when compared to the same quarter one year prior, rising from -$0.60 million to $54.10 million.
  • The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. Compared to other companies in the Semiconductors & Semiconductor Equipment industry and the overall market on the basis of return on equity, ON SEMICONDUCTOR CORP has underperformed in comparison with the industry average, but has exceeded that of the S&P 500.
  • This stock's share value has moved by only 24.16% over the past year. The fact that the stock is now selling for less than others in its industry in relation to its current earnings is not reason enough to justify a buy rating at this time.
  • Net operating cash flow has declined marginally to $157.20 million or 3.26% when compared to the same quarter last year. Despite a decrease in cash flow of 3.26%, ON SEMICONDUCTOR CORP is in line with the industry average cash flow growth rate of -4.00%.

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