DIOD vs ON: Which Is the Better Buy in 2026?

Last updated November 2026

Short answer

ON is the larger of the two ($27.72B market cap): the incumbent the market prices for continued execution (15.65x forward earnings, beta 2.15). DIOD is the smaller challenger ($3.72B), priced similarly on forward earnings (14.56x): more room to run, but more to prove. The real question is which set of drivers you believe, and whether owning one (or both) leaves you over-concentrated.

DIOD vs ON: the tie-breaker metrics

Same yardstick, side by side (as of November 2026). Valuation lined up like this is most meaningful for two names in the same corner of the market, which these are. Figures are approximate; verify before investing.

Metric	DIOD	ON	What it tells you
Market cap	$3.72B	$27.72B	Size. The larger name is the incumbent; the smaller has more room to grow and more to prove.
Forward P/E	14.56	15.65	Valuation on next year's expected earnings, the same yardstick for both. Lower is cheaper for that growth; higher means the market is paying up.
Trailing P/E	43.22	45.94	Valuation on the last 12 months. A big drop from trailing to forward means the market expects earnings to jump, so more growth is already in the price.
Beta	1.98	2.15	Volatility vs the market. Above 1 swings harder than the index; below 1 is steadier. Higher beta means bigger drawdowns to hold through.
Price vs 52-week range	46% of range	29% of range	Where today's price sits between the 52-week low and high. Near the high is momentum with less margin of safety; near the low is out of favor or a discount, depending on why.
Price / book	1.90	3.84	How much you pay over book value. Very high can signal an asset-light, high-return business or a rich price.

Before you buy: how DIOD and ON affect your concentration

The metrics above tell you which is the marginally better business. The bigger risk for most people is not picking the slightly worse stock, it is over-concentrating. DIOD and ON share themes, so owning both, or adding either to what you already hold, can quietly push a large share of your portfolio into one bet.

This is the part a generic comparison page cannot answer, because it depends on what you own. Connect your brokerage and Walnut shows your real, combined DIOD and ON exposure, flags overlap with your existing positions, and tells you if adding one would tip you past a concentration you are comfortable with, read-only by default, with your login staying at your broker. Walnut is not an investment adviser.

What does Diodes Incorporated (DIOD) do?

Diodes Incorporated has been making semiconductors since 1959 and sells into the parts of an electronic system that rarely get named on a spec sheet: protection diodes, MOSFETs, power management, logic, clock generators and timing devices, LED drivers, sensors and interface chips. Customers are automotive tier ones, industrial equipment makers, server and PC builders, consumer electronics brands and handset makers. Revenue is heavily Asian by billing geography (about 77% of Q1 2026 sales, against roughly 14% Europe and 9% North America), and the company runs a hybrid manufacturing model, fabricating roughly half its wafers internally and buying the rest from foundry partners in Korea and Taiwan. That mix of owned fabs plus outsourced capacity is what makes the earnings line swing so hard: fixed costs are real, so utilization drives gross margin, and gross margin drives everything else.

Full DIOD guide

What does onsemi (ON) do?

onsemi (ON Semiconductor) is a US-based semiconductor company focused on intelligent power and sensing technologies. Its power products, including silicon and silicon-carbide devices, manage and convert electricity in electric vehicles, industrial equipment, and power supplies, while its sensing products, such as image sensors, are used in automotive cameras and industrial vision. The company has deliberately concentrated on automotive and industrial markets, where semiconductor content per vehicle and per machine is rising, and it has been repositioning its manufacturing and product mix toward higher-margin, differentiated products rather than commodity chips.

Full ON guide

DIOD vs ON: how do they differ?

Both fit overlapping themes, but they are not interchangeable. The useful comparison is which set of drivers and risks you want exposure to.

DIOD drivers: Margin recovery from utilization and cost discipline; Automotive and industrial content growth.
ON drivers: AI data-center power opportunity; Rising semiconductor content in vehicles.

Which fits which kind of investor

A faster-growing, richer-valued name usually swings harder, so it suits a longer horizon and a higher tolerance for volatility; a steadier, more cash-generative business suits a more conservative or income-minded investor. The honest test is which set of risks you could hold through a drawdown: This is a cyclical business with a documented history of severe drawdowns: revenue fell roughly 35% from the 2022 peak to the 2024 trough, and the stock traded as low as about $42 within the past 52 weeks against a recent price near $85, after touching about $126 in the summer. For ON, the dominant risk is cyclicality: onsemi's automotive and industrial end markets rise and fall with the economy, vehicle production, and factory investment, so revenue and earnings can swing sharply and a soft patch can pressure results even amid long-run content growth.

DIOD or ON: which should you pick?

Growth-minded investors who believe the theme has years to run tend to accept the richer multiple for more upside; value-minded investors lean toward the cheaper forward earnings and steadier profile. Pick DIOD if you believe its drivers more; ON if you believe its. Many investors hold both, but since they share themes, that is a concentrated bet, not diversification. Decide deliberately and check overlap. For the full detail, see the DIOD and ON guides.

DIOD vs ON: the full fundamentals

DIOD. The valuation gap between trailing and forward multiples is the whole argument in this stock. On trailing GAAP earnings of roughly $1.87 per share the multiple looks expensive at about 46 times, but forward estimates near $5.83 per share for 2027, which assume revenue grows to about $2.27 billion, put it closer to 15 times. Trailing free cash flow of about $177 million on roughly $250 million of operating cash flow shows a business still investing through the recovery. Leverage was minimal at June 30, 2026, with about $440 million of cash and short-term investments, but the balance sheet since then reflects both the $250 million ElevATE payment and the $325 million of convertible notes.

ON. Figures are approximate and as of October 16, 2026; verify live numbers before acting. For a cyclical semiconductor company, earnings multiples look high near a trough and low near a peak, which is why onsemi screens at about 50 times trailing GAAP earnings but about 16 times forward estimates, at roughly 4.6 times trailing sales. Analysts' mean target of about $105 across 27 analysts sits well above the price, and the November 2 report will test whether AI data-center and industrial growth can carry the forecast recovery.

Headline figures (approximate, October 2026): DIOD shows revenue (ttm) ~$1.63 billion, up ~22% year over year in the latest quarter, q2 2026 results ~$445.5 million revenue; ~$0.70 non-GAAP EPS vs ~$0.61 consensus (~$1.00 GAAP), margins (ttm) Gross ~31.7%, operating ~7.5%, net ~5.3%; Q2 gross margin 33.1%, q3 2026 guidance ~$510 million revenue (plus or minus 3%), ~$1.05 non-GAAP EPS; reports November 5; ON shows revenue (ttm) ~$6.2 billion (Q2 2026 up ~9% YoY), revenue (q2 2026) ~$1.60 billion, non-gaap eps (q2 2026) ~$0.74 vs ~$0.72 estimate, margins (ttm) gross ~43%, operating ~20%, net ~10%.

The bottom line: DIOD vs ON

DIOD and ON are related but distinct: same themes, different businesses and risks. Neither wins in the abstract; the right pick is whichever thesis you actually believe, sized so you are not over-concentrated in one theme. Walnut can show your combined DIOD and ON exposure against your real portfolio. It is not an investment adviser.

Wondering how DIOD or ON fits the portfolio you already own? Walnut is an AI investing app that connects your brokerage read-only and answers questions like that about your actual holdings: overlap, concentration, and how each position tracks the S&P 500. Compare the best AI portfolio analyzers or see the best AI investing apps in 2026.

Investing in Diodes Incorporated with AI

Connect the broker you already use and ask Walnut's AI how DIOD fits what you actually hold: whether you own it already through a fund, what it would do to your concentration, and how it has tracked the S&P 500. Read-only by default, and you approve anything before it reaches your broker.

Does DIOD fit me?

FAQ

What is the difference between DIOD and ON?

Is DIOD or ON the better stock?

Neither is universally better. ON is the larger incumbent; DIOD is the smaller challenger and looks cheaper on forward earnings. Walnut is informational, not investment advice. Compare what each does, the tie-breaker metrics above, and the risks, then decide which fits your thesis and what you already own.

Which is cheaper, DIOD or ON?

On forward P/E (as of November 2026), DIOD trades at 14.56x and ON at 15.65x, so DIOD is the cheaper of the two on next year's expected earnings. A lower multiple is not automatically the better buy: a richer valuation can be justified by faster growth, and a lower one can reflect real risk. Weigh the multiple against how fast each business is compounding.

Should you own both DIOD and ON?

Because they share themes, owning both concentrates you in that theme. That can be intentional (a focused bet) or accidental (less diversification than it looks). Walnut can show your combined exposure across both, and whether adding either over-concentrates you, before you buy.

What are the risks of DIOD vs ON?

DIOD: This is a cyclical business with a documented history of severe drawdowns: revenue fell roughly 35% from the 2022 peak to the 2024 trough, and the stock traded as low as about $42 within the past 52 weeks against a recent price near $85, after touching about $126 in the summer. Reported GAAP earnings currently flatter the picture, because Q2 2026 GAAP net income of $46.6 million ($1.00 per diluted share) exceeded non-GAAP adjusted net income of $32.5 million ($0.70 per share) largely on approximately $20 million of unrealized investment gains, so the trailing P/E near 46 and the forward P/E near 15 tell very different stories about the same company. Roughly 77% of sales are billed into Asia and a material part of assembly and test capacity sits in China, which exposes the company to tariffs, export controls and regional demand shocks; communications revenue already declined about 3% year over year on soft Chinese smartphone demand. Owned fabs mean high fixed costs, so a demand air pocket compresses margins quickly. ElevATE adds integration and purchase-accounting risk, and the $325 million convertible notes add debt and potential dilution if converted. Diodes pays no dividend and carries a beta near 1.9, so the entire return case rests on the cycle continuing to move in its favor. ON: The dominant risk is cyclicality: onsemi's automotive and industrial end markets rise and fall with the economy, vehicle production, and factory investment, so revenue and earnings can swing sharply and a soft patch can pressure results even amid long-run content growth. Competition is intense from larger and specialized power- and analog-chip makers, which can pressure pricing and share. The silicon-carbide and AI data-center opportunities require heavy investment and execution, and demand there could disappoint or arrive more slowly than hoped. Semiconductor manufacturing is capital-intensive, so factory utilization and inventory swings can move margins quickly. Concentration in automotive means an EV or auto-production slowdown would hit onsemi harder than a more diversified chipmaker. Trade policy, tariffs, and the health of key customers add further variables outside the company's control. Valuation adds its own risk: at roughly 50 times trailing GAAP earnings and 16 times forward, the shares already discount a strong recovery, and the stock fell about 19% over the three months to mid-October 2026 even as estimates rose.

Walnut is informational, not investment advice. This page is descriptive and not a recommendation to buy or sell DIOD or ON; figures are approximate and dated (as of November 2026). Verify current data before investing.