Goldman Sachs’ Mark Delaney expressed a constructive stance on the opportunity for ON Semiconductor Corp
Delaney reinitiated coverage of ON Semiconductor with a Neutral rating and price target of $13.
“The most interesting product cycle in our view is in ADAS, where ON is the market leader in image sensors and we expect ON’s
Delaney also expects significant synergies in both COGS and opex, including shifting Fairchild to ON Semiconductor’s back-end network, and stated that ON Semiconductor had 20–25 percent cost advantage and that back-end could rise up to 50 percent of the cost of a chip.
“ON’s CEO Keith Jackson was previously EVP at Fairchild and we believe is very familiar with the asset. In addition,
Volatility And Competition
Delaney explained that the Neutral rating was based on the “reasonable” stock valuation, as well as “discrete semis are one of the most competitive and volatile areas in semis.”
The analyst expects long-term declines in computer and consumer sales, which account for about 25 percent of the company’s total revenue.
|Oct 2016||Goldman Sachs||Reinstates||Neutral|
|Oct 2016||Pacific Crest||Maintains||Overweight|
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