JPMorgan: Semiconductor Buy-Side Expectations Above Guidance, 9 Stocks Including onsemi Face Earnings Test

TechFlow news, according to TechFlow Research, a JPMorgan buy-side survey on August 3 showed that for the majority of the nine semiconductor and hardware companies, buy-side expectations exceeded company guidance. onsemi (ON) Q2 revenue buy-side average was $1.61 billion (guidance $1.59 billion), gross margin 39.5% (guidance 39.0%), EPS $0.75 (guidance $0.71), fiscal 2027 EPS average $3.57 (guidance $3.11). About 60% of respondents expect ON to slightly raise its 2026 AI revenue target (currently about $500 million). After a stock price pullback of about 25%, ON has shifted from net short to slightly net short, with earnings implied volatility at 7.5%.

For the eight companies AMAT, AMD, ANET, COHR, CSCO, LITE, SNDK, and WDC, the buy-side averages for revenue, gross margin, and EPS were all higher than company guidance. JPMorgan believes that while July AI momentum unwinding led to a significant pullback in the semiconductor sector, buy-side expectations for earnings are not low, creating a contrast between buy-side expectations and pessimistic stock prices. AMAT earnings implied volatility at 18% is significantly higher than the historical average, and the bar for beating expectations is rising. ON is an exception, with extremely low AI expectations, leaving room for an earnings beat.