Onto Innovation: Buy Rating Maintained Amid Market Share Challenges and Segment Strengths

Charles Shi, an analyst from Needham, maintained the Buy rating on Onto Innovation (ONTO – Research Report). The associated price target was lowered to $150.00.

Charles Shi has given his Buy rating due to a combination of factors influencing Onto Innovation’s performance. Despite the company’s recent challenges, including a notable loss in 2.5D market share to a competitor, Shi believes that Onto Innovation’s other business segments are performing as anticipated. The company’s revenue from NAND, DRAM, HBM, and 2.5D is expected to decline in the third quarter of 2025 but should see a recovery by the fourth quarter, suggesting a potential rebound.
Moreover, Shi highlights that gains in the IRIS segment, which deals with blanket film metrology, are expected to compensate for the 2.5D share loss. Although there is a temporary reduction in AI packaging share, Shi suggests that this may not have a lasting impact on the company’s valuation. Consequently, while the price target has been adjusted to $150, the Buy rating reflects confidence in the company’s ability to navigate these challenges and capitalize on its strengths.

In another report released today, Benchmark Co. also maintained a Buy rating on the stock with a $190.00 price target.