Onsemi (NASDAQ:ON) vs. Alpha and Omega Semiconductor (NASDAQ:AOSL) Critical Contrast

Alpha and Omega Semiconductor (NASDAQ:AOSL) and Onsemi (NASDAQ:ON) are both computer and technology companies, but which is the superior stock? We will compare the two businesses based on the strength of their institutional ownership, analyst recommendations, dividends, profitability, earnings, valuation and risk.

Analyst Recommendations

This is a summary of recent recommendations for Alpha and Omega Semiconductor and Onsemi, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Alpha and Omega Semiconductor	1	0	2	0	2.33
Onsemi	2	7	15	0	2.54

Alpha and Omega Semiconductor currently has a consensus price target of $38.67, suggesting a potential downside of 2.97%. Onsemi has a consensus price target of $80.50, suggesting a potential upside of 57.07%. Given Onsemi’s stronger consensus rating and higher probable upside, analysts clearly believe Onsemi is more favorable than Alpha and Omega Semiconductor.

Valuation & Earnings

This table compares Alpha and Omega Semiconductor and Onsemi”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Alpha and Omega Semiconductor	$657.27 million	1.76	-$11.08 million	($0.80)	-49.81
Onsemi	$8.25 billion	2.64	$2.18 billion	$4.03	12.72

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

Profitability

This table compares Alpha and Omega Semiconductor and Onsemi’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Alpha and Omega Semiconductor	-3.46%	-0.23%	-0.18%
Onsemi	23.80%	22.38%	13.57%

Volatility and Risk

Alpha and Omega Semiconductor has a beta of 2.47, indicating that its stock price is 147% more volatile than the S&P 500. Comparatively, Onsemi has a beta of 1.61, indicating that its stock price is 61% more volatile than the S&P 500.

Insider & Institutional Ownership

79.0% of Alpha and Omega Semiconductor shares are held by institutional investors. Comparatively, 97.7% of Onsemi shares are held by institutional investors. 16.9% of Alpha and Omega Semiconductor shares are held by company insiders. Comparatively, 0.3% of Onsemi shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Summary

Onsemi beats Alpha and Omega Semiconductor on 12 of the 14 factors compared between the two stocks.

About Alpha and Omega Semiconductor

Alpha and Omega Semiconductor Limited designs, develops, and supplies power semiconductor products for computing, consumer electronics, communication, and industrial applications in Hong Kong, China, South Korea, the United States, and internationally. It offers power discrete products, including metal-oxide-semiconductor field-effect transistors (MOSFET), SRFETs, XSFET, electrostatic discharge, protected MOSFETs, high and mid-voltage MOSFETs, and insulated gate bipolar transistors for use in smart phone chargers, battery packs, notebooks, desktop and servers, data centers, base stations, graphics card, game boxes, TVs, AC adapters, power supplies, motor control, power tools, E-vehicles, white goods and industrial motor drives, UPS systems, solar inverters, and industrial welding. The company also provides power ICs that deliver power, as well as control and regulate the power management variables, such as the flow of current and level of voltage. Its power ICs are used in flat panel displays, TVs, notebooks, graphic cards, servers, DVD/Blu-Ray players, set-top boxes, and networking equipment. In addition, the company offers transient voltage suppressors, analog switch, and electromagnetic interference filter for notebooks, desktop PCs, tablets, flat panel displays, TVs, smart phones, and portable electronic devices; and 650V and 1200V SiC MOSFET. Alpha and Omega Semiconductor Limited was incorporated in 2000 and is headquartered in Sunnyvale, California.

About Onsemi

onsemi is engaged in disruptive innovations and also a supplier of power and analog semiconductors. The firm offers vehicle electrification and safety, sustainable energy grids, industrial automation, and 5G and cloud infrastructure, with a focus on automotive and industrial end-markets. It operates through the following segments: Power Solutions Group, Advanced Solutions Group, and Intelligent Sensing Group. The Power Solutions Group segment offers discrete, module, and semiconductor products that perform multiple application functions, including power switching, power conversion, signal conditioning, circuit protection, signal amplification, and voltage reference functions. The Advanced Solutions Group segment is involved in the designing and developing of analog, mixed-signal, advanced logic, ASSPs and ASICs, Wi-Fi and power solutions for a broad base of end-users in the automotive, consumer, computing, industrial, communications, medical and aerospace/defense markets. The Intelligent Sensing Group segment is focused on the designing and developing of CMOS and CCD image sensors, as well as proximity sensors, image signal processors, single photon detectors, inclu