ON Semiconductor (ON) Joins Russell Growth Indexes On A Pullback But Is It Fully Valued - simplywall.st

ON Semiconductor (ON) has been added to several Russell Growth Indexes, including the Russell 3000 Growth and Russell 1000 Growth Benchmarks, drawing renewed attention to its role in growth-focused po... Read original →

ON Semiconductor’s inclusion in Russell Growth Indexes masks a valuation rift: its SiC and wide-bandgap tech are reshaping power architectures in automotive and AI infrastructure, forcing upstream substrate suppliers to scale and downstream designs toward high-voltage, high-frequency systems. However, U.S. CHIPS Act compliance hurdles and supply chain exposure to Taiwan, China elevate operational risk. With NVIDIA optimizing AI energy efficiency and AMD integrating power delivery via chiplets, ON must push SiC yields beyond 85% or risk losing edge markets to Synaptics’ system-level solutions. Over the next 12–24 months, slowing EV adoption will test its fab utilization floor, while AI data centers’ insatiable demand for kilowatt-scale efficient power could become its true long-tail driver—if current share prices haven’t already priced it in.