ON Semiconductor Corporation (NASDAQ: ON) has seen a steep pullback this year as weakness in automotive and industrial demand weighed on results. The stock trades near $50/share, down about 29% over the past year. Even so, analysts remain optimistic that ON’s focus on profitability and exposure to electric vehicles and energy-efficient technologies could drive a steady recovery.
Recently, ON announced new long-term supply agreements with several major automakers to expand its silicon carbide production capacity. Management also highlighted plans to streamline manufacturing and optimize capital spending to protect margins in a slower demand environment. These moves show ON is staying disciplined and preparing for stronger growth once industry conditions improve.
This article explores where Wall Street analysts expect ON Semiconductor to trade by 2027. We’ve compiled consensus targets and valuation models to outline the stock’s potential path. These figures reflect current analyst expectations and are not TIKR’s own predictions.
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Analyst Price Targets Suggest Modest Upside
ON trades near $50/share today. The average analyst price target is around $58/share, implying about 14% upside from current levels. Forecasts show a cautious but balanced view:
- High estimate: ~$70/share
- Low estimate: ~$40/share
- Median target: ~$58/share
- Ratings: 12 Buys, 3 Outperforms, 18 Holds, 1 Underperform
For investors, this suggests modest upside potential as ON works through a cyclical downturn in chip demand. Analysts generally expect the company to hold its ground, supported by solid margins and disciplined capital allocation. While it is not viewed as a high-upside play right now, the valuation leaves room for outperformance if demand in automotive and industrial markets rebounds sooner than expected.
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ON Semiconductor: Growth Outlook and Valuation
ON’s financial profile remains sturdy despite softer revenue trends:
- Revenue expected to decline ~0.5% annually through 2027
- Operating margins forecast around 24.5%
- Shares trade near 18x forward earnings
- Based on analysts’ average estimates, TIKR’s Guided Valuation Model using a 17.6x forward P/E suggests about $66/share by 2027
- That implies roughly 29% total return, or about 12% annualized
For investors, this outlook points to steady compounding potential rather than explosive growth. The key will be ON’s ability to maintain cost discipline while scaling high-value silicon carbide and automotive power solutions. If management executes well, the stock could deliver consistent returns even in a slower-growth environment.
What makes ON attractive is its position in two durable markets: automotive electrification and global energy efficiency. This gives the company a long runway for recovery once semiconductor demand stabilizes.
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What’s Driving the Optimism?
ON remains one of the key players driving the global shift toward electrification. Its strength in automotive and industrial semiconductors positions it at the heart of long-term demand trends such as electric vehicles, clean energy infrastructure, and factory automation.
Management continues to emphasize higher-margin, mission-critical products like silicon carbide power devices and intelligent sensing solutions. For investors, these strengths show that ON is managing the current slowdown effectively and building a stronger foundation for long-term growth.
Bear Case: Slow Recovery and Competition
Despite its strong positioning, ON still faces near-term challenges. Automotive and industrial demand could take longer to recover, and increasing competition in power semiconductors may pressure margins if pricing tightens.
For investors, the main risk is timing. ON’s long-term story remains intact, but earnings growth might stay muted until visibility improves. The stock could remain range-bound in the short term before its next growth phase begins.
Outlook for 2027: What Could ON Be Worth?
Based on analysts’ average estimates, TIKR’s Guided Valuation Model suggests ON could trade near $66/share by 2027, representing about 29% total returns, or roughly 12% annualized gains.
That scenario assumes margins stay strong and the company continues focusing on high-value automotive and industrial markets. For investors, ON looks like a steady compounder rather than a speculative growth stock.
While the recovery may take time, ON’s disciplined execution, solid balance sheet, and leadership in power-efficient chip technologies give it the potential to outperform once industry demand stabilizes.
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