Why On Semiconductor (ONNN) Stock Is Dropping Today

NEW YORK (TheStreet) -- On Semiconductor (ONNN) shares are down -2.2% to $8.52 after having coverage initiated with an "underweight" rating by analysts at Evercore  (EVR).

The firm set a price target of $8 on the company's shares.

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Analyst Michael Lucarelli does not believe the company's acquisitions have affected its bottom line positively and sees the continued practice of acquiring companies as a harmful strategy.

"From a strategy standpoint, we do not believe ON's acquisitive nature has been beneficial. It has failed to stimulate revenue growth, been margin destructive, diluted earnings, reduced focus on the core business, and taken away from S/H returns," said Lucarelli.

Separately, 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 a number of strengths, 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, increase in stock price during the past year, impressive record of earnings per share growth, compelling growth in net income and reasonable valuation levels. Although no company is perfect, currently we do not see any significant weaknesses which are likely to detract from the generally positive outlook."

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