ON Semiconductor Corporation (ON) & AXT (AXTI) Financial Survey

ON Semiconductor Corporation (NASDAQ: ON) and AXT (NASDAQ:AXTI) are both computer and technology companies, but which is the superior business? We will contrast the two businesses based on the strength of their analyst recommendations, profitability, risk, institutional ownership, valuation, dividends and earnings.

Profitability

This table compares ON Semiconductor Corporation and AXT’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
ON Semiconductor Corporation 5.88% 22.74% 6.46%
AXT 8.15% 4.61% 4.10%

Volatility & Risk

ON Semiconductor Corporation has a beta of 2.01, suggesting that its share price is 101% more volatile than the S&P 500. Comparatively, AXT has a beta of 1.16, suggesting that its share price is 16% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of recent recommendations for ON Semiconductor Corporation and AXT, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
ON Semiconductor Corporation 1 5 12 0 2.61
AXT 0 1 3 0 2.75

ON Semiconductor Corporation presently has a consensus price target of $19.22, indicating a potential downside of 4.24%. AXT has a consensus price target of $9.63, indicating a potential upside of 7.54%. Given AXT’s stronger consensus rating and higher probable upside, analysts plainly believe AXT is more favorable than ON Semiconductor Corporation.

Institutional and Insider Ownership

97.9% of ON Semiconductor Corporation shares are held by institutional investors. Comparatively, 61.9% of AXT shares are held by institutional investors. 1.6% of ON Semiconductor Corporation shares are held by insiders. Comparatively, 6.9% of AXT shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Earnings & Valuation

This table compares ON Semiconductor Corporation and AXT’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
ON Semiconductor Corporation $4.99 billion 1.70 $1.02 billion $0.68 29.52
AXT $86.31 million 3.98 $13.40 million $0.20 44.75

ON Semiconductor Corporation has higher revenue and earnings than AXT. ON Semiconductor Corporation is trading at a lower price-to-earnings ratio than AXT, indicating that it is currently the more affordable of the two stocks.

Summary

ON Semiconductor Corporation beats AXT on 8 of the 14 factors compared between the two stocks.

About ON Semiconductor Corporation

ON Semiconductor Corporation offers a portfolio of sensors, power management, connectivity, custom and system on chip (SoC), analog, logic, timing, and discrete devices. The Company’s segments include Power Solutions Group, Analog Solutions Group and Image Sensor Group. The Power Solutions Group offers a range of discrete, module and integrated semiconductor products. The Analog Solutions Group designs and develops analog, mixed-signal and logic application specific integrated circuits (ASICs) and application specific standard products (ASSPs), and power solutions. The Image Sensor Group designs and develops complementary metal oxide semiconductor (CMOS) and charge-coupled device (CCD) image sensors, as well as proximity sensors, image signal processors, and actuator drivers for autofocus and image stabilization for various end users in the automotive, industrial, consumer, wireless, medical, and aerospace/defense markets.

About AXT

AXT, Inc. (AXT) is a developer and producer of compound and single element semiconductor substrates, also known as wafers. The dominant substrates used in producing semiconductor chips and other electronic circuits are made from silicon. The Company is engaged in the design, development, manufacture and distribution of compound semiconductor substrates and sale of materials. The Company provides alternative or specialty materials in the form of substrates or wafers, including compound and single element substrates. Its compound substrates combine indium with phosphorous (InP) or gallium with arsenic (GaAs). Its single element substrates are made from germanium (Ge). The Company uses its Vertical Gradient Freeze (VGF) technique for growing single crystal Indium Phosphide (InP), Gallium Arsenide (GaAs) and Germanium (Ge) ingots used to produce wafers for diverse electronic and optoelectronic device and circuit applications.

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