On Semiconductor Outlook - Navigating a Technical Crossroads and Market Volatility

Market Snapshot

Headline Takeaway: On Semiconductor (ON) faces a mixed landscape with technical neutrality, but strong inflows and mixed analyst views suggest caution and close monitoring. Stance: Wait-and-see.

News Highlights

The semiconductor sector remains in the crosshairs of global trade dynamics and environmental concerns. Here are two key updates:

• McKinsey’s Tariff Analysis: New research from McKinsey & Co suggests that U.S. tariff policies could significantly impact global semiconductor supply chains, especially as legal uncertainties persist. This could affect demand and pricing in the long term.
• Japan’s Strategic Cooperation Proposals: Japan is reportedly planning to propose expanded cooperation with the U.S. on rare earths and semiconductors. If successful, these efforts could help reduce dependency on China and stabilize trade flows—an indirect tailwind for ON.

Analyst Views & Fundamentals

The analyst landscape for On Semiconductor remains mixed, with a simple average rating of 3.00 and a performance-weighted average of 1.65. This suggests a generally bearish sentiment among analysts, with recent forecasts leaning towards neutrality.

Notably, the lone analyst active in the past 20 days—Vivek Arya of B of A Securities—has offered a "Neutral" outlook (on 2025-09-05), with a historical win rate of 50.0% and an average return of 2.93%. The lack of consensus indicates a volatile and uncertain environment.

From a fundamental perspective, the company's key financial metrics show a mixed bag:

• Net Cash Flow from Operating Activities per Share (YoY growth rate %): -93.18% Internal diagnostic score: 1.00
• Total Profit (YoY growth rate %): -138.16% Internal diagnostic score: 1.00
• Net Cash Flow from Operating Activities (YoY growth rate %): -8.63% Internal diagnostic score: 2.00
• PCF (Price-to-Cash Flow): 118.57 Internal diagnostic score: 3.00
• EV/EBIT: -43.19% Internal diagnostic score: 0.00
• Cash-UP (Cash-to-Enterprise Value): -1.14% Internal diagnostic score: 2.00

This suggests that while cash flow is deteriorating, some liquidity metrics remain relatively stable.

Money-Flow Trends

The money flows in the On Semiconductor universe show a mixed but positive overall trend, with overall inflow ratio at 50.97%, suggesting continued participation from major players.

• Large and Extra-Large Institutional Inflows: Both categories show inflow ratios above 49%, indicating that larger investors are cautiously optimistic.
• Retail Investor Sentiment: Mixed, with small investors showing a negative trend (49.89% inflow ratio), suggesting caution at the retail level.

This duality points to a situation where institutions are staying engaged, while retail investors may be waiting for a clearer direction.

Key Technical Signals

On Semiconductor’s technical outlook is currently mixed, with the technical score at 5.41—indicating a wait-and-see stance. Here are the key signals to watch:

• RSI Oversold: Internal diagnostic score: 8.47 — strong bullish potential after a period of overselling.
• Bearish Engulfing: Internal diagnostic score: 7.77 — a bearish candlestick pattern suggesting potential downward pressure.
• MACD Golden Cross: Internal diagnostic score: 5.71 — a bullish signal indicating momentum turning upwards.
• MACD Death Cross: Internal diagnostic score: 6.92 — a bearish signal that could trigger selling pressure.

Recent chart patterns over the last five days (as of 2025-09-12) include the Bearish Engulfing and RSI Oversold patterns, suggesting a volatility-driven environment with no clear directional bias. Analysts recommend watching for a breakout before committing to a trade.

Conclusion

Actionable Takeaway: With technical indicators in a tug-of-war and mixed analyst views, the best strategy for On Semiconductor may be to wait for a clearer breakout or earnings update. Investors should monitor the RSI Oversold and Bearish Engulfing patterns for signs of momentum. For now, caution and patience are key in a market where both bullish and bearish signals are in play.