ON Semiconductor Faces Valuation Shift Amid Declining Operating Profit and Rising Costs

ON Semiconductor Corp., a midcap player in the Other Electrical Equipment industry, has recently experienced an adjustment in its evaluation. The revision in its score reflects a shift in the valuation grade, moving from a previously attractive position to one now considered expensive.
Key financial metrics indicate a P/E ratio of 23, alongside a price-to-book value of 3.67. The company's enterprise value to EBIT stands at 22.12, while the EV to EBITDA ratio is recorded at 14.88. Additionally, the EV to sales ratio is noted at 4.47. The return on capital employed (ROCE) is reported at 16.05%, with a return on equity (ROE) of 15.99%.

Despite these figures, the company has faced significant challenges, including a decline in operating profit of 20.4% for the quarter ending June 2025, marking a continuation of negative results over the past six quarters. The operating cash flow has reached its lowest at USD 1,832.1 million, and interest expenses have increased by 41.34%.

Overall, ON Semiconductor Corp. is navigating a complex financial landscape, with performance metrics reflecting a need for careful consideration.

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