Onto Innovation Inc. (NYSE: ONTO)

Sector: Technology Industry: Semiconductor Equipment & Materials CIK: 0000704532
Market Cap 10.71 Bn
P/B 5.35
P/E 61.19
P/S 10.69
ROIC (Qtr) 7.19
Div Yield % 0.00
Rev 1y % (Qtr) -13.49
Total Debt (Qtr) 0.00
Debt/Equity (Qtr) 0.00

About

Onto Innovation Inc., a leading provider of metrology and inspection solutions for the semiconductor industry, operates with the stock symbol ONTO on the NASDAQ exchange. The company is a key player in the high-tech industry, providing essential tools for semiconductor manufacturing. With a presence in over 28 countries, Onto Innovation has established itself as a trusted partner for semiconductor manufacturers, offering cutting-edge solutions to improve manufacturing processes and increase yields. Onto Innovation's primary business activities...

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Price action

Investment thesis

Bull case

  • Operating cash flow of 289.32M provides strong 10.66x coverage of stock compensation 27.13M, indicating sustainable incentive practices.
  • Strong operating cash flow of 289.32M provides 1.70x coverage of SG&A expenses 170.42M, showing efficient operational cost management.
  • Robust free cash flow of 261.31M exceeds capital expenditure of 28.01M by 9.33x, indicating strong organic growth funding capability.
  • Tangible assets of 1.75B provide exceptional 57.03x coverage of deferred revenue 30.76M, showing strong service capability backing.
  • Short-term investments of 380.84M provide solid 3.46x coverage of other current liabilities 109.94M, indicating strong liquidity.

Bear case

  • Cash reserves of 603.09M provide limited coverage of acquisition spending of (26.82M), which is -22.49x, suggesting aggressive expansion might strain liquidity if market conditions deteriorate.
  • Retained earnings of 733.26M provide limited buffer against comprehensive income items of (6.42M), which is -114.16x, indicating elevated exposure to market risks.
  • Operating cash flow of 289.32M is outpaced by equity issuance of (90.34M) (-3.20 ratio), indicating concerning reliance on equity markets for funding operations.
  • Tangible assets of 1.75B provide limited backing for working capital of 1.38B, which is 1.27x, suggesting increased operational risk in market downturns.
  • Fixed assets of 129.07M showing 2.45x ratio to depreciation of 52.66M indicates aging infrastructure requiring significant near-term capital investment.

Geographical Breakdown of Revenue (2024)

Product and Service Breakdown of Revenue (2024)

Peer comparison

Companies in the Semiconductor Equipment & Materials
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 ASML Asml Holding Nv 545.55 Bn 81.60 25.80 3.18 Bn
2 LRCX Lam Research Corp 270.12 Bn 366.11 84.92 4.48 Bn
3 AMAT Applied Materials Inc /De 260.74 Bn 38.58 9.28 6.56 Bn
4 KLAC Kla Corp 207.40 Bn 64.64 19.12 5.89 Bn
5 TER Teradyne, Inc 47.70 Bn 421.67 28.58 0.27 Bn
6 ENTG Entegris Inc 15.99 Bn 199.19 14.79 3.91 Bn
7 NVMI Nova Ltd. 12.80 Bn 52.23 15.01 0.88 Bn
8 AMKR Amkor Technology, Inc. 11.99 Bn 21.67 2.07 1.89 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 4.80 3.68
EV to Cash from Ops. EV/CFO 36.27 27.99
EV to Debt EV to Debt 0.00 2,137.46
EV to EBIT EV/EBIT 53.91 47.14
EV to EBITDA EV/EBITDA 48.99 30.10
EV to Free Cash Flow [EV/FCF] EV/FCF 40.16 68.49
EV to Market Cap EV to Market Cap 0.98 0.93
EV to Revenue EV/Rev 10.47 55.25
Price to Book Value [P/B] P/B 5.35 11.74
Price to Earnings [P/E] P/E 61.19 58.42
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Dividend Coverage Ratio 0.00 0.93
Dividend Payout Ratio % Div Payout % (Qtr) 0.00 667.25
Dividend per Basic Share Div per Share (Qtr) 0.00 0.62
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) 0.00 8.52
Interest Coverage Int. cover (Qtr) 0.00 86.73
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) -3.97 -57.75
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) 219.54 21.17
Dividend Growth (1y) % Dividend Growth (1y) % 0.00 6.43
EBIAT Growth (1y) % EBIAT 1y % (Qtr) -4.43 -69.60
EBITDA Growth (1y) % EBITDA 1y % (Qtr) -10.66 -68.67
EBIT Growth (1y) % EBIT 1y % (Qtr) -4.12 -68.41
EBT Growth (1y) % EBT 1y % (Qtr) -4.12 -76.59
EPS Growth (1y) % EPS 1y % (Qtr) -3.78 -164.09
FCF Growth (1y) % FCF 1y % (Qtr) 16.49 70.63
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) 3.57 43.70
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 0.46 0.54
Cash Payout Ratio Cash Payout (Qtr) 0.00 0.04
Cash Ratio Cash Ratio (Qtr) 3.70 1.52
Current Ratio Curr Ratio (Qtr) 9.49 4.04
Debt to Equity Ratio Debt/Equity (Qtr) 0.00 0.30
Interest Cover Ratio Int Coverage (Qtr) 0.00 86.73
Times Interest Earned Times Interest Earned (Qtr) 0.00 86.73
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) 24.70 -1,802.55
EBIT Margin % EBIT Margin % (Qtr) 19.42 -1,926.38
EBT Margin % EBT Margin % (Qtr) 19.42 -1,932.94
Gross Margin % Gross Margin % (Qtr) 50.70 22.58
Net Profit Margin % Net Margin % (Qtr) 17.50 -2,101.05