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    Assessing Onto Innovation (ONTO) Valuation After Mixed Returns And Semilab Acquisition Narrative

    Simply Wall St·01/06/2026 10:34:15
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    Onto Innovation Stock Snapshot

    Onto Innovation (ONTO) has recently drawn attention after a period of mixed returns, including a monthly gain alongside a negative 1-year total return. This has prompted investors to reassess the stock’s profile and recent performance.

    See our latest analysis for Onto Innovation.

    The recent 1-day share price return of 7.42% and 7-day share price return of 11.36% place the stock at $178.18. The 1-year total shareholder return of a 7.95% decline contrasts with a 5-year total shareholder return of 228.87%, suggesting short term momentum has picked up even as the longer term picture remains mixed.

    If Onto Innovation’s recent share price surge has your attention, it can be useful to see what else is moving in chip related tech, including high growth tech and AI stocks.

    With annual revenue growth of 13.91%, net income growth of 27.26% and a recent price of $178.18 that sits above both analyst targets and some intrinsic estimates, is there still a buying opportunity here, or is the market already pricing in future growth?

    Most Popular Narrative Narrative: 13.5% Overvalued

    At a last close of $178.18 against a narrative fair value of about $157, this view implies the market is already paying a premium for Onto Innovation.

    The pending Semilab acquisition will immediately expand Onto's product portfolio into electrical surface metrology and materials analysis capabilities specifically in demand as industry transitions to exotic materials and heterogeneous integration, enabling both direct revenue accretion (~$130M annualized) and gross/operating margin uplift, further increasing earnings per share by 10%+ in the first year post-deal.

    Read the complete narrative.

    Curious how a richer product mix, higher margins, and a future earnings multiple all tie together into one valuation story? The narrative leans on ambitious growth, firmer profitability, and a discounted future cash stream to reach its fair value. The exact mix of revenue scale, margin targets, and required P/E is where the real insight sits.

    Result: Fair Value of $157 (OVERVALUED)

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

    However, this story can quickly change if the expected rebound in AI packaging demand stalls, or if integration of the Semilab deal proves tougher than planned.

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

    Build Your Own Onto Innovation Narrative

    If you are not fully on board with this storyline or simply prefer to test the assumptions yourself, you can rebuild the case from the ground up in just a few minutes, starting with Do it your way.

    A good starting point is our analysis highlighting 1 key reward investors are optimistic about regarding Onto Innovation.

    Looking for more investment ideas?

    If Onto Innovation has sharpened your focus, do not stop here. Widening your watchlist now can help you spot opportunities before they are crowded.

    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.