Wall Street’s patience with onsemi (ON) is wearing thin. Analysts are slashing their price targets and pulling ratings after the chipmaker’s earnings miss and gloomy guidance sent shares tumbling nearly 8% on Monday.
B. Riley Downgrades onsemi on Weak Margins
B. Riley’s Craig Ellis, a 5-star analyst on TipRanks, downgraded the stock from Buy to Neutral and slashed the price target from $73 to $41. Ellis said the firm now sees “risk to second-half estimates” as weakness in key end markets builds. He flagged deteriorating gross margins and flat demand, adding, “We are shifting to the sidelines until there’s clearer traction on earnings growth.”
The downgrade followed onsemi’s Q1 results, which showed revenue down 22% year-over-year, falling short of Wall Street’s expectations. While EPS came in ahead of estimates at $0.55, the bigger concern was soft demand across all business segments and a cautious outlook for Q2.
Citigroup Warns of More Cuts Ahead
Citigroup kept a Neutral rating but trimmed its target from $52 to $40. Analysts said they expect “limited upside near term” and warned the company could lower guidance again in the second half of the year. The firm sees “uncertainty around recovery timing,” especially given rising macroeconomic pressures and continued inventory burn from customers.
Craig-Hallum Turns Cautious on Demand Trends
Craig-Hallum also moved from Buy to Hold, cutting its target from $50 to $45. Analysts pointed to softening demand trends and the lack of visibility into a near-term recovery. They said onsemi’s design-win momentum remains promising, but “we need to see proof it can translate into growth amid a sluggish macro backdrop.”
Despite a sharp increase in free cash flow, analysts are hesitant to call a bottom. Several firms are waiting to see how onsemi performs in the second half of 2025, especially with competitors also facing cyclical weakness.
Is onsemi a Good Stock to Buy?
Despite a string of downgrades, onsemi still holds a “Moderate Buy” consensus. Out of 25 analysts covering the stock over the past three months, 14 rate it a Buy, 10 say Hold, and just one is at Sell.
That said, sentiment is clearly cooling. The average 12-month ON price target now sits at $53.50 — a 39% upside from the current price of $38.41. The highest forecast still clings to $85. The lowest has dropped to $34.
That gap speaks volumes. While some analysts still see potential upside, others are starting to hedge. B. Riley, Citi, and Craig-Hallum have all trimmed their sails lately — and if that sentiment spreads, the balance could tip fast. If onsemi doesn’t stabilize its demand trends soon, more of those “Holds” could quietly shift lower.
