$30 Trillion Opportunity: 15 Best Humanoid Robot Stocks to Buy According to Morgan Stanley

9. ON Semiconductor Corporation (NASDAQ:ON)

Number of Hedge Fund Investors  in Q1 2024: 45

ON Semiconductor Corporation (NASDAQ:ON) is another large semiconductor manufacturer. Headquartered in Arizona, it makes a variety of key products that can be used in humanoids. These include sensors, power management products, signal amplification products, and more. ON Semiconductor Corporation (NASDAQ:ON) targets the automotive and industrial machinery industries with its products, which provides it with a stable source of product demand that is dependent on the economic cycle. However, ON Semiconductor Corporation (NASDAQ:ON)’s dependence on EVs can also prove to be problematic due to downward cost pressures in the industry stemming from higher supply as more EV companies enter the market. Additionally, since it does not operate on the leading edge of the semiconductor industry, ON Semiconductor Corporation (NASDAQ:ON) has limited potential to benefit from the multi billion dollar CHIPS and Science Act.

ON Semiconductor Corporation (NASDAQ:ON) commented on the current market pressures that it’s facing during the Q2 2024 earnings call:

“As we indicated in our Q1 call, we are seeing some stabilization in demand in our core markets. Inventory digestion persists with some pockets improving as customers maintain a cautious stance in 2024. We don’t see a change to the L-shaped curve I talked about in Q1, but we expect parts of industrial, such as Energy Infrastructure to recover in the second half. Among the regions, Asia-Pacific, namely China is recovering, driven by both automotive and industrial.

During this time of market uncertainty, we have not taken our foot off the pedal and remain focused on what we can control our execution. We have doubled down on our investments to build out our strategic portfolio of Analog and Mixed-Signal and Power Solutions. We have been gaining share by securing significant design wins in power, and we have continued to improve our cost structure through ongoing structural changes. All these efforts position us very well in a recovery with top-line growth and gross margin expansion. Our advantage remains in our comprehensive and innovative product portfolio to capture market opportunities. onsemi’s intelligent power and sensing solutions have become synonymous with high efficiency and performance, which are critical to solving customer problems and the high-growth megatrends in automotive, industrial, and AI data centers.”