Group President At ON Semiconductor Sells $1.92M Of Stock

SIMON KEETON, Group President at ON Semiconductor ON, reported an insider sell on December 18, according to a new SEC filing.

What Happened: KEETON's recent Form 4 filing with the U.S. Securities and Exchange Commission on Wednesday unveiled the sale of 28,000 shares of ON Semiconductor. The total transaction value is $1,919,789.

At Thursday morning, ON Semiconductor shares are up by 1.34%, trading at $65.8.

Discovering ON Semiconductor: A Closer Look

Onsemi is a supplier of power semiconductors and sensors focused on the automotive and industrial markets. Onsemi is the second-largest power chipmaker in the world and the largest supplier of image sensors to the automotive market. While the firm used to be highly vertically integrated, it now pursues a hybrid manufacturing strategy for flexible capacity. Onsemi is pivoting to focus on emerging applications like electric vehicles, autonomous vehicles, industrial automation, and renewable energy.

ON Semiconductor: Delving into Financials

Negative Revenue Trend: Examining ON Semiconductor's financials over 3 months reveals challenges. As of 30 September, 2024, the company experienced a decline of approximately -19.21% in revenue growth, reflecting a decrease in top-line earnings. When compared to others in the Information Technology sector, the company faces challenges, achieving a growth rate lower than the average among peers.

Analyzing Profitability Metrics:

• Gross Margin: The company shows a low gross margin of 45.37%, suggesting potential challenges in cost control and profitability compared to its peers.

• Earnings per Share (EPS): ON Semiconductor's EPS reflects a decline, falling below the industry average with a current EPS of 0.94.

Debt Management: ON Semiconductor's debt-to-equity ratio is notably higher than the industry average. With a ratio of 0.39, the company relies more heavily on borrowed funds, indicating a higher level of financial risk.

Valuation Overview:

• Price to Earnings (P/E) Ratio: With a lower-than-average P/E ratio of 16.11, the stock indicates an attractive valuation, potentially presenting a buying opportunity.

• Price to Sales (P/S) Ratio: With a P/S ratio of 3.83 below industry standards, the stock shows potential undervaluation, making it an appealing investment option for those focusing on sales performance.

• EV/EBITDA Analysis (Enterprise Value to its Earnings Before Interest, Taxes, Depreciation & Amortization): With an EV/EBITDA ratio lower than industry benchmarks at 10.44, ON Semiconductor presents an attractive value opportunity.

Market Capitalization Analysis: The company's market capitalization is below the industry average, suggesting that it is relatively smaller compared to peers. This could be due to various factors, including perceived growth potential or operational scale.

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Why Insider Transactions Are Key in Investment Decisions

Considering insider transactions is valuable, but it's crucial to evaluate them in conjunction with other investment factors.

From a legal standpoint, the term "insider" pertains to any officer, director, or beneficial owner holding more than ten percent of a company's equity securities as outlined in Section 12 of the Securities Exchange Act of 1934. This encompasses executives in the c-suite and significant hedge funds. These insiders are mandated to inform the public of their transactions through a Form 4 filing, to be submitted within two business days of the transaction.

A company insider's new purchase is a indicator of their positive anticipation for a rise in the stock.

While insider sells may not necessarily reflect a bearish view and can be motivated by various factors.

Transaction Codes Worth Your Attention

Investors prefer focusing on transactions that take place in the open market, indicated in Table I of the Form 4 filing. A P in Box 3 indicates a purchase, while S indicates a sale. Transaction code C indicates the conversion of an option, and transaction code A indicates grant, award or other acquisition of securities from the company.

Check Out The Full List Of ON Semiconductor's Insider Trades.

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This article was generated by Benzinga's automated content engine and reviewed by an editor.