Needham on Thursday raised its price target for Onto Innovation Inc. (NYSE: ONTO) to $275 from $260 and kept a Buy rating on the shares, which were trading at $225.33 at the time of the report. The firm anchored its revised valuation on a 32 times price-to-earnings multiple applied to its updated calendar-year 2027 non-GAAP earnings per share estimate.
Needham pointed to the company’s guidance for the first quarter of fiscal 2026, which calls for sequential revenue growth of 5% - a figure that would be flat if contributions from the Semilab acquisition are excluded. The firm described Onto’s most recent quarter as largely consistent with expectations on both revenue and gross margins.
The brokerage highlighted an improved outlook for full-year 2026, driven in part by an expected stronger first half. Needham expects the first half of 2026 to be organically 12% to 14% higher than the second half of 2025. Importantly, the firm also projects the second half of 2026 will surpass the first half, a pattern it says will be supported partly by a $240 million volume purchase agreement with an HBM customer for DragonFly systems.
Those operational drivers sit alongside notable share-price momentum: Onto’s stock has climbed 113% over the past six months. Needham now models organic revenue, excluding Semilab, to increase about 15% year over year.
On a segment basis, the firm expects Advanced Packaging revenue to grow by more than 30% this year and Advanced Nodes to expand by more than 15%. Needham noted that these upside contributors are being partially offset by incremental softness in power devices and in the Semilab business.
In parallel, Cantor Fitzgerald upgraded its view on Onto Innovation to Overweight from Neutral and raised its price target to $275 from $170. Cantor’s projections are more aggressive than consensus: the firm estimates first-half 2026 revenue in a range between $575 million and $600 million, above the consensus figure of $554 million.
Cantor analyst Matthew Prisco signaled material upside to earnings expectations, forecasting 2026 earnings of $7.00 or more per share and 2027 earnings of $9.25 or more per share. Those forecasts exceed current consensus estimates of $6.23 and $7.66 per share for 2026 and 2027, respectively.
Collectively, the Needham and Cantor moves represent a clear shift in analyst sentiment toward a more favorable view of Onto’s near-term financial trajectory. Investors should note, however, that InvestingPro analysis indicates the stock appears overvalued at current levels relative to its Fair Value estimate.
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Summary takeaway: Two influential brokerages have lifted price targets and outlooks for Onto Innovation, citing stronger-than-expected revenue cadence, meaningful growth in Advanced Packaging and Advanced Nodes, and a large DragonFly volume agreement. These upgrades come amid strong recent share performance and raise the bar for the company’s 2026 results while valuation remains a consideration.