Baird Cuts Price Target as ON Semiconductor (ON) Reports In-Line Results
Baird maintained an Outperform rating on ON Semiconductor (NASDAQ: ON), and cut the price target to $12.00 (from $13.00), following the company's 4Q earnings report. ON reported 4Q pro forma EPS of $0.19, exactly in line with consensus. Revenue of $840.3 million was below the midpoint of the $830-$870 million guidance. The $820 million midpoint of 1Q16 revenue guidance is below previous estimates of $855.5 million and consensus of $840.0 million. 1Q revenue guidance is $800-$840 million.
Analyst Tristan Gerra commented, "Reiterating Outperform rating on valuation and company-specific growth catalysts. While too early to know whether the company’s current rebound in orders is sustainable (could be inventory-replenishment related), we continue to expect the Fairchild acquisition to close with accretion starting 2H16, while ON Semi should benefit from share and content gains in PCs. We continue to see secular growth opportunities in Imaging. We believe ON is better positioned than peers to navigate through a weak environment potentially lingering throughout this year."
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Shares of ON Semiconductor closed at $8.05 yesterday.