ON Intrinsic Value

ON

ON Semiconductor Corp. – Semiconductor and Related Device Manufacturing

ON Semiconductor is driving energy efficient innovations, empowering customers to reduce global energy use. The company is a leading supplier of semiconductor-based solutions, offering a comprehensive portfolio of energy efficient, power management, analog, sensors, logic, timing, connectivity, discrete, SoC and custom devices. The company's products help engineers solve their unique design challenges in automotive, communications, computing, consumer, industrial, medical, aerospace and defense applications. ON Semiconductor operates a responsive, reliable, world-class supply chain and quality program, a robust compliance and ethics program, and a network of manufacturing facilities, sales offices and design centers in key markets throughout North America, Europe and the Asia Pacific regions.

Analysis Results

Intrinsic Value	$263.36
Latest Price	$81.21
Relative Value	69% undervalued

Share results:

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Cash Flow (Billions)

Analysis Parameters

New Ticker

Analysis Details

Growth Rate Projection

An exponential growth model was fit to the past cash flow data, giving more weight to more recent years. This model determined a growth rate estimate of 20.5%.

Weighted Average Cost of Capital (WACC)

The calculated WACC is 3.3%. This value is used as the default discount rate.

Value of Future Flows

Assuming a growth rate of 20.5%, the cash flows for the next 5 years are projected.

The present value of each year's flow is adjusted to present value using the discount rate.

Year	Future flow (billion)	Present value (billion)
2023	1.93	1.87
2024	2.33	2.18
2025	2.81	2.55
2026	3.38	2.97
2027	4.07	3.47

Terminal Value

Assuming the company was sold after the projection period at an exit multiple of 30, the terminal value of the company would be 122 billion. This corresponds to a present value of 101 billion.

Intrinsic Value Per Share

The total present value of the projected cash flows is 13.0 billion. Adding in the terminal value gives a total present value of 114 billion.

There are presently 432.0 million outstanding shares, so the intrinsic value per share is 263.36.

Financial Statements

The following data was to determine the past cash flows.

Current Assets	5,729,400,000
Current Cash	2,919,000,000
Current Liabilities	2,061,400,000
Current Debt	162,000,000
Non-Cash Working Capital (NCWC)	911,000,000
Change in NCWC	-135,300,000
EBIT	2,764,700,000
Tax Provision	458,400,000
Depreciation and Amortization	551,800,000
Capital Expenditure	-1,005,000,000
Unlevered Free Cash Flow	1,639,692,303

Current Assets	3,781,600,000
Current Cash	1,352,600,000
Current Liabilities	1,543,400,000
Current Debt	160,700,000
Non-Cash Working Capital (NCWC)	1,046,300,000
Change in NCWC	85,800,000
EBIT	1,361,900,000
Tax Provision	146,600,000
Depreciation and Amortization	596,700,000
Capital Expenditure	-444,600,000
Unlevered Free Cash Flow	1,427,356,970

Current Assets	3,184,100,000
Current Cash	1,080,700,000
Current Liabilities	1,674,500,000
Current Debt	531,600,000
Non-Cash Working Capital (NCWC)	960,500,000
Change in NCWC	-82,900,000
EBIT	415,200,000
Tax Provision	-59,800,000
Depreciation and Amortization	625,100,000
Capital Expenditure	-383,600,000
Unlevered Free Cash Flow	573,800,000

Current Assets	3,020,000,000
Current Cash	894,200,000
Current Liabilities	1,818,400,000
Current Debt	736,000,000
Non-Cash Working Capital (NCWC)	1,043,400,000
Change in NCWC	276,000,000
EBIT	632,500,000
Tax Provision	62,700,000
Depreciation and Amortization	593,100,000
Capital Expenditure	-534,600,000
Unlevered Free Cash Flow	823,624,186

Current Assets	3,167,800,000
Current Cash	1,069,600,000
Current Liabilities	1,469,300,000
Current Debt	138,500,000
Non-Cash Working Capital (NCWC)	767,400,000
Change in NCWC	-55,800,000
EBIT	858,300,000
Tax Provision	125,100,000
Depreciation and Amortization	508,700,000
Capital Expenditure	-514,800,000
Unlevered Free Cash Flow	654,183,668

Current Assets	2,933,200,000
Current Cash	949,200,000
Current Liabilities	1,408,900,000
Current Debt	248,100,000
Non-Cash Working Capital (NCWC)	823,200,000
Change in NCWC	-69,000,000
EBIT	714,800,000
Tax Provision	-265,500,000
Depreciation and Amortization	481,900,000
Capital Expenditure	-387,500,000
Unlevered Free Cash Flow	740,200,000

Current Assets	2,869,100,000
Current Cash	1,028,100,000
Current Liabilities	1,502,600,000
Current Debt	553,800,000
Non-Cash Working Capital (NCWC)	892,200,000
Change in NCWC	314,200,000
EBIT	271,500,000
Tax Provision	-3,900,000
Depreciation and Amortization	364,100,000
Capital Expenditure	-210,700,000
Unlevered Free Cash Flow	739,100,000

Current Assets	1,891,500,000
Current Cash	617,600,000
Current Liabilities	1,239,300,000
Current Debt	543,400,000
Non-Cash Working Capital (NCWC)	578,000,000
Change in NCWC	121,200,000
EBIT	274,200,000
Tax Provision	10,800,000
Depreciation and Amortization	357,600,000
Capital Expenditure	-270,800,000
Unlevered Free Cash Flow	468,727,024

Current Assets	1,805,800,000
Current Cash	517,800,000
Current Liabilities	1,040,800,000
Current Debt	209,600,000
Non-Cash Working Capital (NCWC)	456,800,000
Change in NCWC	9,900,000
EBIT	269,000,000
Tax Provision	-200,000
Depreciation and Amortization	268,800,000
Capital Expenditure	-204,300,000
Unlevered Free Cash Flow	343,400,000

Current Assets	1,710,200,000
Current Cash	625,700,000
Current Liabilities	819,200,000
Current Debt	181,600,000
Non-Cash Working Capital (NCWC)	446,900,000
Change in NCWC	55,900,000
EBIT	251,400,000
Tax Provision	26,900,000
Depreciation and Amortization	211,800,000
Capital Expenditure	-156,500,000
Unlevered Free Cash Flow	325,216,583

Current Assets	1,693,400,000
Current Cash	631,700,000
Current Liabilities	1,024,300,000
Current Debt	353,600,000
Non-Cash Working Capital (NCWC)	391,000,000
Change in NCWC	70,200,000
EBIT	198,500,000
Tax Provision	13,400,000
Depreciation and Amortization	243,600,000
Capital Expenditure	-256,300,000
Unlevered Free Cash Flow	256,000,000

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