Is ON Semiconductor Corp. overvalued or undervalued?

As of 17 October 2025, the valuation grade for ON Semiconductor Corp. has moved from attractive to expensive, indicating a shift in perception regarding its market valuation. The company appears to be overvalued, particularly when considering its P/E ratio of 23, which is lower than the peer average of approximately 25.65, and an EV to EBITDA ratio of 14.88, which also suggests a premium compared to its peers. Additionally, the Price to Book Value stands at 3.67, further supporting the notion of overvaluation.
In comparison to its peer, Microchip Technology, Inc., which has a significantly higher P/E ratio, ON Semiconductor's valuation metrics suggest it is not justified at its current price level. Recent stock performance shows that while ON Semiconductor outperformed the S&P 500 over the past week and month, it has underperformed significantly year-to-date and over the past year, with returns of -16.69% and -24.13%, respectively, compared to the S&P 500's 13.30% and 14.08%. This trend reinforces the view that the stock is overvalued in the current market context.