Onto Innovation Inc (ONTO)
NYSE:ONTO
Top Page
Onto Innovation
(NYSE:ONTO)
Select Model
Select Model
Rating:79Outperform
Price Target:
$229.00
▲(4.35% Upside)
Action:ReiteratedDate:02/25/26
The score is driven primarily by strong financial quality (debt-free balance sheet and robust free cash flow) and supportive technical momentum (price above key moving averages with positive MACD). These are tempered by a demanding valuation (high P/E) despite an upbeat earnings call that highlighted rising backlog, strong revenue guidance, and expected margin expansion.
Positive Factors
Debt-free balance sheet
Onto's essentially debt-free balance sheet and growing equity provide durable financial flexibility to fund R&D, M&A (e.g., Semilab), and capacity expansion without relying on external debt. This conservatism lowers default risk and supports long-term investment through semiconductor cycles.
Negative Factors
Margin compression & lower ROE
Margins and returns have meaningfully contracted from prior peaks, indicating weaker operating leverage or higher costs. If margins do not sustainably re-expand, capital returns and reinvestment capacity will be constrained, lowering earnings resilience across the semiconductor cycle.
Read all positive and negative factors
Positive Factors
Negative Factors
Debt-free balance sheet
Onto's essentially debt-free balance sheet and growing equity provide durable financial flexibility to fund R&D, M&A (e.g., Semilab), and capacity expansion without relying on external debt. This conservatism lowers default risk and supports long-term investment through semiconductor cycles.
Read all positive factors
Onto Innovation (ONTO) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$10.43B
Dividend YieldN/A
Average Volume (3M)947.39K
Price to Earnings (P/E)59.6
Beta (1Y)2.31
Revenue Growth6.38%
EPS Growth-4.15%
CountryUS
Employees1,551
SectorTechnology
Sector Strength88
IndustrySemiconductors
Share Statistics
EPS (TTM)1.26
Shares Outstanding49,702,362
10 Day Avg. Volume771,867
30 Day Avg. Volume947,390
Financial Highlights & Ratios
PEG Ratio-1.86
Price to Book (P/B)3.88
Price to Sales (P/S)8.11
P/FCF Ratio27.18
Enterprise Value/Market Cap1.05
Enterprise Value/Revenue10.86
Enterprise Value/Gross Profit21.84
Enterprise Value/Ebitda49.53
Forecast
1Y Price Target
$265.71Price Target Upside21.07% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering7
EPS Forecast (FY)6.19
Revenue Forecast (FY)$1.26B
Onto Innovation Business Overview & Revenue Model
Company Description
Onto Innovation Inc. engages in the design, development, manufacture, and support of process control tools that performs macro defect inspection and 2D/3D optical metrology, lithography systems, and process control analytical software worldwide. I...
How the Company Makes Money
Onto Innovation primarily makes money by selling semiconductor capital equipment—metrology and inspection tools used in-line or at-line in semiconductor manufacturing to detect defects, measure critical dimensions/film properties, and control proc...
Onto Innovation Key Performance Indicators (KPIs)
Any
Revenue by Segment
Reveals how different parts of the business contribute to overall sales, highlighting key areas of strength and potential vulnerabilities in the company's operations.
Reveals how different parts of the business contribute to overall sales, highlighting key areas of strength and potential vulnerabilities in the company's operations.
Data provided by:
The Fly
The FlyOnto Innovation Earnings Call Summary
Earnings Call Date:Feb 19, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:May 06, 2026
Earnings Call Sentiment Positive
The call communicated strong operational and financial momentum: record quarterly and annual revenue, improved margins, record cash generation, a large multi-year VPA (> $240M), doubled backlog and bullish guidance (Q1 revenue $275M–$285M; Q2 >$300M). Key growth engines are advanced packaging (>30% expected growth in 2026) and advanced nodes (more than doubled in 2025), supported by new product introductions and strategic Semilab acquisition. Offsets and near-term risks include a projected ~10% decline in power semiconductor revenue in 2026, supply-chain and lead-time pressures, and timing uncertainty for some advanced nodes ramps and next-gen product qualifications. Overall, the positives materially outweigh the negatives and management is guiding to continued margin and revenue expansion throughout 2026.Positive Updates
Record Quarterly and Full-Year Revenue
Q4 record revenue of $267 million, a 22% increase sequentially from Q3; full-year 2025 revenue was a record $1.005 billion.
Negative Updates
Power Semiconductor Headwinds
Power semiconductor revenue, while strong in Q4, is expected to decline seasonally in Q1 and be down ~10% for 2026 due to weakening EV demand and slowing infrastructure spending; this will impact Semilab-related power-semicondutor revenue as well.
Read all updates
Q4-2025 Updates
Positive
Negative
Record Quarterly and Full-Year Revenue
Q4 record revenue of $267 million, a 22% increase sequentially from Q3; full-year 2025 revenue was a record $1.005 billion.
Read all positive updates
Company Guidance
The company guided Q1 revenue of $275 million to $285 million (Q4 was $267M, up 22% QoQ) and expects Q2 revenue to exceed $300 million, implying 12%–14% core growth in H1 2026 versus H2 2025; backlog has nearly doubled over the last three months to about two quarters of cover. They forecast continued margin expansion each quarter in 2026, with Q4 gross margin at 54.6% (improved ~50 bps from Q3) and Q1 gross margin at the midpoint expected to be ~50 bps higher, Q4 operating margin was 25.2% (up 410 bps QoQ) and Q1 operating margin is expected to be ~25.5%–26.5% with operating expenses of about $80 million. EPS for Q1 is projected at $1.26–$1.36 (assuming ~16% tax rate and ~49.9 million shares), and management reiterated record FY2025 revenue of $1.005 billion, Q4 cash generation of $95 million (cash conversion ~150% of non‑GAAP net income), Semilab contributed roughly $9 million in Q4 and is expected to be in the low $100M–$110M revenue range in 2026, advanced packaging revenue is expected to grow over 30% in 2026 while power semiconductor revenue is forecast to decline about 10%, and advanced nodes visibility points to mid‑teens growth (within a 10%–20% WFE range) as VPAs and customer ramps solidify.Onto Innovation Financial Statement Overview
Summary
Income Statement
72
Positive
Balance Sheet
92
Very Positive
Cash Flow
85
Very Positive
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 1.01B | 987.32M | 815.87M | 1.01B | 788.90M |
| Gross Profit | 499.77M | 515.31M | 420.25M | 539.22M | 429.09M |
| EBITDA | 223.34M | 249.41M | 183.29M | 301.38M | 222.21M |
| Net Income | 136.76M | 201.67M | 121.16M | 223.33M | 142.35M |
Balance Sheet | |||||
| Total Assets | 2.37B | 2.12B | 1.91B | 1.79B | 1.65B |
| Cash, Cash Equivalents and Short-Term Investments | 639.62M | 852.33M | 697.81M | 547.78M | 511.34M |
| Total Debt | 0.00 | 15.16M | 19.52M | 22.02M | 17.72M |
| Total Liabilities | 267.09M | 191.21M | 173.18M | 198.44M | 223.76M |
| Stockholders Equity | 2.10B | 1.93B | 1.74B | 1.60B | 1.43B |
Cash Flow | |||||
| Free Cash Flow | 299.80M | 213.77M | 149.40M | 118.30M | 163.24M |
| Operating Cash Flow | 328.31M | 245.68M | 171.97M | 136.70M | 175.28M |
| Investing Cash Flow | -121.57M | -226.55M | -103.39M | -55.69M | -141.79M |
| Financing Cash Flow | -75.15M | -35.67M | -9.47M | -68.35M | 2.67M |
Onto Innovation Technical Analysis
Positive
219.46
Price Trends
207.55
Positive
178.65
Positive
144.85
Positive
Market Momentum
0.37
Negative
59.33
Neutral
80.45
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ONTO, the sentiment is Positive. The current price of 219.46 is above the 20-day moving average (MA) of 202.73, above the 50-day MA of 207.55, and above the 200-day MA of 144.85, indicating a bullish trend. The MACD of 0.37 indicates Negative momentum. The RSI at 59.33 is Neutral, neither overbought nor oversold. The STOCH value of 80.45 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for ONTO.
Onto Innovation Risk Analysis
Onto Innovation disclosed 40 risk factors in its most recent earnings report. Onto Innovation reported the most risks in the "Tech & Innovation" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Onto Innovation Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
79 Outperform | $10.43B | 59.58 | 6.85% | ― | 6.38% | -4.15% | |
74 Outperform | $14.97B | 38.14 | 22.70% | ― | 39.37% | 40.87% | |
71 Outperform | $7.90B | 95.83 | 8.42% | ― | 21.12% | -54.97% | |
68 Neutral | $12.43B | 26.10 | 8.73% | 0.81% | 0.13% | -16.17% | |
66 Neutral | $5.88B | 149.88 | -1.40% | ― | -7.23% | -15.69% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% | |
55 Neutral | $7.25B | -63.06 | -6.93% | ― | 20.60% | ― |
* Technology Sector Average
ONTO
Onto Innovation
221.04
87.96
66.10%
AMKR
Amkor
49.93
30.80
160.96%
CAMT
Camtek
175.08
110.46
170.94%
NVMI
Nova
481.28
280.24
139.40%
SMTC
Semtech
80.04
41.35
106.88%
ALGM
Allegro MicroSystems
32.63
5.78
21.53%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.