BN · rank #11 · 2026-10-21
ONTO
NYSE · $10.78B (USD)
The exact numbers the algorithm saw.
| Composite score Z-score blend of the factors below; drives the rank. | 0.32 |
|---|---|
| Forward revenue growth Consensus forward revenue growth. | +30.8% |
| Forward net margin Consensus forward net margin. | +13.1% |
| Net margin TTM Trailing twelve month net margin. | +11.8% |
| Margin expansion Forward minus trailing net margin (percentage points). | +1.2% |
| Forward PEG Forward P/E to growth. Below 1 is cheap for the growth. | 0.76 |
| Debt / FCF Net debt relative to free cash flow. Lower is safer. | 5.83× |
| Analyst upside Spread between the consensus 12m target and the current price. | +71.2% |
| Last EPS surprise Most recent reported EPS versus consensus. | +15% |
| Market cap (USD) | $10.78B |
The AI research card
Independent qualitative review of each pick before the order is placed. On the rare day the research service is unavailable, the paper book trades on the quant ranking alone and no card appears here.
Summary
Onto Innovation designs and sells process-control inspection and metrology systems that are critical gatekeepers in advanced-node logic, HBM, and 2.5D packaging production lines.
Rationale
Record $343M Q2 revenue (+35% YoY), a first-ever $1B+ backlog, SK hynix's Best Partner Award for Dragonfly G5 HBM deployment, and a 0.76 forward PEG collectively confirm ONTO is a genuine structural bottleneck-solver with near-term revenue visibility rather than a sentiment trade.
Material risks
- 1KLA, Camtek, and Nova are active competitors in every segment Onto serves, and customers can dual-qualify tools, meaning Onto's differentiated position is contestable rather than sole-source — the core moat assumption requires ongoing re-qualification wins to hold.
- 2The $1.472B net convertible note balance materially increases leverage on a balance sheet that previously carried minimal debt, and any demand air-pocket (e.g., export-control tightening on HBM shipments to China) could stress free-cash-flow coverage given debt-to-FCF of 5.8x.
AI verdict council
Each pick is reviewed independently by 3 models before any order. 3 of 3 voted to proceed.