Thursday, February 11, 2016

Seeking Alpha: ON Semiconductor Still Floundering

Even in a rough tape for semiconductors as a group, ON Semiconductor's (NASDAQ:ON) performance has been noticeably worse. The shares basically tracked the PHLX Semiconductor Index for most of the past year, but weak results in the third quarter led to a deeper plunge that has the shares down more than a third over the last year, and the brief rally in the wake of the bid for Fairchild (NASDAQ:FCS) proved fleeting.

I'm of two minds on ON Semiconductor at this point. The shares look cheap by the metrics I use, but this is starting to remind me more than a little bit of Atmel (NASDAQ:ATML) - a company with good technology and potential, but where management has never really been able to deliver on any sort of consistent basis. While I see Fairchild as potentially a very positive acquisition, ON management's abject failure with the Sanyo deal cannot, and should not, be forgotten.

I know a lot of readers want those of us who write for Seeking Alpha to give them clear "buy/sell" calls, but I really can't do that with ON Semiconductor. I believe the company should and can produce better results than it has, but that does not mean that it will. Investors aren't being asked to pay a lot to find out if they can do better, but if I were to buy, I'd at least go in aware of the risk that this is a serial underperformer that could disappoint for a while.

Read more here:
ON Semiconductor Still Floundering

No comments: