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Factors to Note Ahead of Onto Innovation's (ONTO) Q2 Earnings
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Onto Innovation (ONTO - Free Report) is set to report results for the second quarter of 2024 on Aug 8.
The Zacks Consensus Estimate for second-quarter earnings per share (EPS) has been steady at $1.19 in the past 60 days, implying an increase of 50.6% from the year-ago quarter’s figure. The company expects non-GAAP EPS in the range of $1.14-$1.26.
Meanwhile, the consensus mark for revenues is pegged at $235.6 million, indicating a rise of 23.6% from the year-earlier quarter’s actual. Management expects revenues in the range of $230-$240 million.
ONTO’s earnings beat the Zacks Consensus Estimate in three of the trailing four quarters while missing once with the average surprise being 2.6%.
The company’s shares have gained 36.5% compared with sub-industry’s growth of 30.8% in the past year.
Image Source: Zacks Investment Research
Factors to Consider
ONTO’s top-line performance is expected to have benefited from the strong adoption of its Dragonfly inspection system. Its Dragonfly G3 platform integrates 2D and 3D technologies to identify yield-killing defects and compute features, which are important for advanced front-end and packaging technologies.
The system is witnessing healthy uptake, owing to higher demand for advanced packaging of AI computing devices. Management expects demand for the system to remain strong in the second quarter. In the last reported quarter, revenues from the Dragonfly system increased 30% sequentially.
Improving demand for IRSS metrology solutions for planar films application is likely to have driven power semiconductor revenues.
Increasing orders, especially for Atlas OCD and Iris planer films, to support advanced logic devices are likely to have driven revenues from the advanced nodes market. In the last reported quarter, advanced nodes revenues of $27 million increased 45% sequentially.
The company’s efforts to reduce inventory levels to boost cash-flow performance bode well. Improvements in supply-chain initiatives are expected to drive gross margin performance. Management projects gross margin of 52-54% for the second quarter.
Weak global macro conditions, higher expenses, forex fluctuations and stiff competition are concerns. Management expects DRAM revenues to remain soft in the second quarter.
What Our Model Says
Our proven model does not conclusively predict an earnings beat for Onto Innovation this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. This is not the case here.
ONTO has an Earnings ESP of 0.00% and a Zacks Rank #3 at present. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Stocks to Consider
Here are a few companies you may want to consider, as our model shows that these have the right combination of elements to post an earnings beat in this earning season.
SHOP is scheduled to report quarterly earnings on Aug 7. The Zacks Consensus Estimate for SHOP’s to-be-reported quarter’s EPS and revenues is pegged at 20 cents and $2 billion, respectively. Shares of SHOP have lost 9.2% in the past year.
Watts Water Technologies Inc (WTS - Free Report) currently has an Earnings ESP of +1.17% and a Zacks Rank #3. WTS is scheduled to report quarterly earnings on Aug 7.
The Zacks Consensus Estimate for WTS’ to-be-reported quarter’s EPS and revenues is pegged at $2.34 and $586.7 million, respectively. Shares of WTS have gained 1% in the past year.
Take-Two Interactive Software Inc (TTWO - Free Report) has an Earnings ESP of +85.72% and a Zacks Rank #2 at present. TTWO is set to report quarterly figures on Aug 8.
The Zacks Consensus Estimate for TTWO’s to-be-reported quarter’s EPS and revenues is pegged at 1 cent and $1.24 billion, respectively. Shares of TTWO have lost 1.2% in the past year.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.
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Factors to Note Ahead of Onto Innovation's (ONTO) Q2 Earnings
Onto Innovation (ONTO - Free Report) is set to report results for the second quarter of 2024 on Aug 8.
The Zacks Consensus Estimate for second-quarter earnings per share (EPS) has been steady at $1.19 in the past 60 days, implying an increase of 50.6% from the year-ago quarter’s figure. The company expects non-GAAP EPS in the range of $1.14-$1.26.
Meanwhile, the consensus mark for revenues is pegged at $235.6 million, indicating a rise of 23.6% from the year-earlier quarter’s actual. Management expects revenues in the range of $230-$240 million.
ONTO’s earnings beat the Zacks Consensus Estimate in three of the trailing four quarters while missing once with the average surprise being 2.6%.
The company’s shares have gained 36.5% compared with sub-industry’s growth of 30.8% in the past year.
Image Source: Zacks Investment Research
Factors to Consider
ONTO’s top-line performance is expected to have benefited from the strong adoption of its Dragonfly inspection system. Its Dragonfly G3 platform integrates 2D and 3D technologies to identify yield-killing defects and compute features, which are important for advanced front-end and packaging technologies.
The system is witnessing healthy uptake, owing to higher demand for advanced packaging of AI computing devices. Management expects demand for the system to remain strong in the second quarter. In the last reported quarter, revenues from the Dragonfly system increased 30% sequentially.
Improving demand for IRSS metrology solutions for planar films application is likely to have driven power semiconductor revenues.
Increasing orders, especially for Atlas OCD and Iris planer films, to support advanced logic devices are likely to have driven revenues from the advanced nodes market. In the last reported quarter, advanced nodes revenues of $27 million increased 45% sequentially.
Onto Innovation Inc. Price and EPS Surprise
Onto Innovation Inc. price-eps-surprise | Onto Innovation Inc. Quote
The company’s efforts to reduce inventory levels to boost cash-flow performance bode well. Improvements in supply-chain initiatives are expected to drive gross margin performance. Management projects gross margin of 52-54% for the second quarter.
Weak global macro conditions, higher expenses, forex fluctuations and stiff competition are concerns. Management expects DRAM revenues to remain soft in the second quarter.
What Our Model Says
Our proven model does not conclusively predict an earnings beat for Onto Innovation this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. This is not the case here.
ONTO has an Earnings ESP of 0.00% and a Zacks Rank #3 at present. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Stocks to Consider
Here are a few companies you may want to consider, as our model shows that these have the right combination of elements to post an earnings beat in this earning season.
Shopify Inc (SHOP - Free Report) has an Earnings ESP of +7.78% and a Zacks Rank #1 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
SHOP is scheduled to report quarterly earnings on Aug 7. The Zacks Consensus Estimate for SHOP’s to-be-reported quarter’s EPS and revenues is pegged at 20 cents and $2 billion, respectively. Shares of SHOP have lost 9.2% in the past year.
Watts Water Technologies Inc (WTS - Free Report) currently has an Earnings ESP of +1.17% and a Zacks Rank #3. WTS is scheduled to report quarterly earnings on Aug 7.
The Zacks Consensus Estimate for WTS’ to-be-reported quarter’s EPS and revenues is pegged at $2.34 and $586.7 million, respectively. Shares of WTS have gained 1% in the past year.
Take-Two Interactive Software Inc (TTWO - Free Report) has an Earnings ESP of +85.72% and a Zacks Rank #2 at present. TTWO is set to report quarterly figures on Aug 8.
The Zacks Consensus Estimate for TTWO’s to-be-reported quarter’s EPS and revenues is pegged at 1 cent and $1.24 billion, respectively. Shares of TTWO have lost 1.2% in the past year.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.