Is ON Semiconductor (ON) Undervalued As Sungrow Picks Its EliteSiC Modules?
ON Semiconductor (ON) is back in focus after Sungrow selected its EliteSiC silicon carbide hybrid power modules for the new PowerTitan 3.0 utility-scale energy storage platform, spotlighting ON’s role in high-efficiency grid storage technology.
For context, ON Semiconductor’s share price has climbed 10.66% over the past month but is still down 15.65% on a 3 month view. Its year to date share price return of 29.98% and 1 year total shareholder return of 40.30% suggest the recent Sungrow win is arriving as momentum rebuilds after a weaker spell.
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ON Semiconductor now sits at US$73.70 after the Sungrow win and a sharp rebound. Does that recent strength still leave enough upside to justify the risks buyers take from here?
Most Popular Narrative: 29% Undervalued
ON Semiconductor’s most followed valuation story pegs fair value at $104.46, which is well above the last close at $73.70. That gap presents the Sungrow deal as one piece of a much broader power and AI grid thesis rather than a single isolated headline.
The company's investments in silicon carbide, vertical GaN and the Embedded Power Platform are now tied to a much larger AI data center opportunity, with management lifting its 2030 server and AI data center market estimate from about US$12b to nearly US$50b and targeting AI data center revenue growth at least 10 percentage points faster than the market, which could materially influence long term revenue and margin expansion.
See why 127 investors see ON Semiconductor as 29% undervalued.
Result: Fair Value of $104.46 (UNDERVALUED)
Still, the story for ON Semiconductor can change quickly if EV demand weakens further or if AI focused power products and the Synaptics deal fail to scale as planned.
Find out about the key risks to this ON Semiconductor narrative.
Next Steps
Mixed messages around ON Semiconductor can be useful if you act before sentiment hardens and carefully weigh both sides of the story for yourself using 2 key rewards and 2 important warning signs.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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