ON Semiconductor (ON) PT Lowered to $62 at Bernstein SocGen

Bernstein SocGen Group analyst Aneesha Sherman lowered the price target on ON Semiconductor (NASDAQ: ON) to $62.00 (from $70.00) while maintaining an Outperform rating.

The analyst commented: "Transitory pressure or structural slowdown? Despite an in-line Q2, weak US Wholesale growth took a toll on the stock, raising concerns of a structural slowdown. Mgmt seems optimistic about a rebound from 2027 launches but given the uncertainty and downward revisions today, we expect the stock to stay out of favor for now, with the Sept Investor Day as the next catalyst. We remain positive but cut PT to $62. Last quarter, we wrote about On’s growth/margin toggle: As a growth brand, On needs to strike a balance between too much growth at low margins (with the risk of losing brand heat and premium positioning) vs. too little growth at higher margins (disappointing the market). In Q2, Mgmt explicitly chose margins over growth, controlling US Wholesale sell-in to keep inventory clean, while DTC outperformed, leading to a sales miss and margin beat."

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