On Semiconductor Outlook - Mixed Signals Amid Volatility

Market Snapshot

Headline Takeaway: On Semiconductor (ON) faces a weak technical outlook with an internal diagnostic score of 4.89, while recent news and mixed analyst views add to the uncertainty for investors.

News Highlights

Recent news paints a mixed picture for the semiconductor sector. The McKinsey report highlights the uncertainty around U.S. tariffs and their potential impact on supply chains, which could affect On Semiconductor's operations in the long term. Meanwhile, the US Semiconductors ETF SOXX reported a $750M net outflow in May 2025, signaling some investor caution in the sector. Additionally, Japan's proposal for U.S. cooperation on rare earths and semiconductors could indirectly influence global supply dynamics, offering a potential long-term benefit for players like ON.

Analyst Views & Fundamentals

The current average analyst rating for On Semiconductor is a simple mean score of 3.00, while the weighted rating (based on historical performance) stands at 1.65. Analysts have shown a neutral stance, with recent ratings indicating a consensus of Neutral. However, there is some dispersion in views, and the market is showing a downward price trend of -1.70% over the last period.

• Fundamental Highlights & Model Scores:
• Net cash flow from operating activities per share (YoY growth rate %): -93.11% – Internal diagnostic score: 1.59
• Total assets turnover ratio: 21.42% – Internal diagnostic score: 4.05
• Net cash flow from operating activities (YoY growth rate %): -8.63% – Internal diagnostic score: 2.28
• EV/EBIT: -43.19% – Internal diagnostic score: 0.96
• GPOA: 4.20% – Internal diagnostic score: 1.82
• Interest coverage ratio (EBIT / Interest expense %): -89.59% – Internal diagnostic score: 1.14

While some fundamentals like total assets turnover ratio appear relatively strong, most indicators show a decline or weak performance, indicating a challenging operating environment for the company.

Money-Flow Trends

Money-flow data reveals a split in investor behavior. While small investors are showing a positive trend, large and extra-large money flows are negative, indicating that institutional investors may be cautiously reducing their exposure. The overall inflow ratio is 48.87%, with large-cap money flows showing the strongest inflow at 50.07%, but this is countered by a negative medium and extra-large trend. This suggests that while some investors are optimistic, the bigger players are taking a more defensive stance.

Key Technical Signals

On the technical front, the stock has shown a volatile performance with mixed signals. Here are the key technical indicators and their internal diagnostic scores:

• WR Overbought: Score 1.59 – Suggests a bearish bias
• MACD Death Cross: Score 6.92 – Neutral rise
• Bearish Engulfing: Score 7.77 – Strong bearish signal
• MACD Golden Cross: Score 4.12 – Mixed signal
• Marubozu White: Score 4.05 – Moderate bullish signal

Over the past five days, key chart patterns like the Bearish Engulfing and MACD Death Cross have emerged, suggesting a bearish bias. Meanwhile, the MACD Golden Cross and Marubozu White offer some hope for a potential rebound. Technical insights indicate a weak trend with unclear direction and a balanced mix of bullish and bearish signals. Investors are advised to monitor these patterns closely and be prepared for volatile swings.

Conclusion

With mixed fundamentals, weak technical signals, and divergent money flows, On Semiconductor appears to be in a state of uncertainty. The internal diagnostic score for technical analysis stands at 4.89, indicating a weak trend that calls for caution. Investors should monitor the company's upcoming earnings and industry developments for clarity. In the short term, it may be wise to consider waiting for a pull-back before taking positions, especially given the volatile market conditions and the mixed analyst outlook.