CFRA likes ON’s exposure to the industrial and automotive markets, about 80% of revenue,
which should support profit margins and better growth opportunities long term. That said, CFRA
sees near-term softness within certain industrial applications and inventory digestion within the
automotive space, similar to peers. Long term, CFRA remain optimistic about content gain
potential within the automotive space due to the electrification of the vehicle (EVs) and
Advanced Driver Assistance System (ADAS) adoption. CFRA see content growth partly
offsetting any potential automotive end demand weakness, while we expect SiC demand
to sharply outpace capacity growth (grew to $800M in 2023 from $200M in 2022; $2.5B
potentially in 2027). Given healthy free cash flow, we see more aggressive buybacks ahead
(new 33B authorization in February).
which should support profit margins and better growth opportunities long term. That said, CFRA
sees near-term softness within certain industrial applications and inventory digestion within the
automotive space, similar to peers. Long term, CFRA remain optimistic about content gain
potential within the automotive space due to the electrification of the vehicle (EVs) and
Advanced Driver Assistance System (ADAS) adoption. CFRA see content growth partly
offsetting any potential automotive end demand weakness, while we expect SiC demand
to sharply outpace capacity growth (grew to $800M in 2023 from $200M in 2022; $2.5B
potentially in 2027). Given healthy free cash flow, we see more aggressive buybacks ahead
(new 33B authorization in February).
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Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.