Onto Innovation (ONTO) Valuation in Focus After Semilab USA Acquisition and Upgraded Revenue Guidance

Onto Innovation (ONTO) has drawn attention after finalizing its acquisition of Semilab USA, a move expected to expand revenue streams and strengthen its market presence. Updated revenue guidance highlights early gains from these newly acquired assets.

See our latest analysis for Onto Innovation.

In the wake of the Semilab USA acquisition and some ambitious new revenue guidance, Onto Innovation’s stock has shown renewed momentum. The share price is up 16.8% over the past 90 days, even as this year's run has been bumpy and the 1-year total shareholder return sits at -23.0%. Long-term holders have still seen impressive cumulative gains, with total shareholder returns of 67% over three years and 188% over five years. This suggests optimism for those willing to look beyond short-term volatility.

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With the stock rebounding after several bullish analyst ratings and new growth drivers, the big question is whether Onto Innovation remains undervalued at current levels or if the market has already factored in its next phase of expansion.

Most Popular Narrative: 14.9% Undervalued

With Onto Innovation’s fair value currently set at $149.38 and a last close at $127.18, the dominant narrative sees the company trading at an attractive discount. Market watchers are fixated on whether the robust outlook and new catalysts can drive the stock higher.

The accelerating adoption of AI packaging and advanced 2.5D/3D logic architectures is driving a major step up in demand for Onto Innovation's next-generation Dragonfly systems. Strong customer pull and new applications are expanding both revenue and potential gross margin through higher ASPs and increased market share within leading-edge chip production.

Read the complete narrative.

Curious what fuels this strong price target? The narrative hinges on a bold growth surge, fatter margins, and an earnings leap that could reshape expectations. Only those who dig deeper find out exactly which forecasts set this valuation apart. Are you ready to see what might be driving the optimism?

Result: Fair Value of $149.38 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, significant reliance on a customer demand rebound and ongoing geopolitical uncertainties could quickly shift sentiment and challenge the current optimism surrounding Onto Innovation’s future growth.

Find out about the key risks to this Onto Innovation narrative.

Build Your Own Onto Innovation Narrative

If you see the story differently or want to dig into the numbers yourself, you can piece together your own perspective in just a few minutes, your way with Do it your way.

A good starting point is our analysis highlighting 3 key rewards investors are optimistic about regarding Onto Innovation.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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