Onsemi is a buy, this analyst says

Roth Capital Partners analyst Suji Desilva says Onsemi’s (Onsemi Stock Quote, Chart, News, Analysts, Financials NASDAQ:ON) planned acquisition of Synaptics creates a broader physical AI edge platform, strengthening the company’s position across robotics, mobility and industrial markets.

In a June 25 update, Desilva maintained his “Buy” rating and $125.00 target on Onsemi.

“We are encouraged by ON’s acquisition of physical AI-native component vendor Synaptics and the combined full-stack sense, connected compute, control/actuation, and power product platform,” Desilva said.

Onsemi announced an all-stock deal valued at about $7-billion, with Synaptics shareholders expected to own about 12% of the combined company. Desilva expects a relatively smooth regulatory process and a close around mid-calendar 2027.

The analyst estimates pro forma calendar 2027 revenue of just under $8-billion before any revenue efficiencies. The combined company should benefit from about $200-million in expected cost savings, primarily in SG&A, with management expecting EPS accretion within 18 months of closing.

Desilva said the acquisition should expand Onsemi’s total addressable market by $30-billion by 2030, giving it broader exposure to AI infrastructure and edge physical AI applications.

Synaptics has said it is working with 35 humanoid robot customers or prospects, with a standalone opportunity of more than $30 per robot. Desilva said the combined company will have a differentiated mix of power, industrial control, sensing and connected compute assets.

“We believe ON/SYNA together have a relatively unique set of advanced power, industrial control, multi-modal sense, and connect compute assets that can push the company to the front of large competitive programs at leading-edge physical AI customers,” he said.

Desilva said he plans to update his model after the deal closes.

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