New York, June 25, 2026, 14:07 (EDT)
- Onto Innovation jumped 7.5% in afternoon trading, moving ahead of chip ETFs and QQQ.
- The stock trades 10.2% under the $381.80 conversion price set on its 2031 zero-coupon notes.
- The 130% conversion or redemption trigger lands at roughly $496.34, just under the capped-call cap of $509.06.
- Analysts list 11 Buys but the average target price is just 3.6% higher than where shares trade now.
Onto Innovation Inc. (NYSE:ONTO) traded higher Thursday, though most of the action was around the new convert. The move pulled shares closer to the $381.80 mark tied to the $1.5 billion zero-coupon convertible notes offered in May.
Shares climbed $24.19, or 7.5%, to $346.43 at 1:50 p.m. EDT. The stock traded as high as $353.15 and as low as $327.00 today. The iShares Semiconductor ETF (NASDAQ:SOXX) rose 3.9%. VanEck Semiconductor ETF (NASDAQ:SMH) gained 2.8%. Invesco QQQ Trust (NASDAQ:QQQ) was up 0.6%.
U.S. markets traded as usual. The Nasdaq schedule puts normal hours at 9:30 a.m. to 4:00 p.m. Eastern. According to its 2026 holiday calendar, markets last closed for Juneteenth on June 19. The next close will be Independence Day, July 3.
ONTO ended Wednesday at $322.24 and Tuesday at $315.88, after dropping 9.2% from the June 22 close of $347.87. With Thursday’s price, the stock reversed most of those two days’ losses, but it hadn’t quite reached Monday’s close.
Micron Technology Inc. (NASDAQ:MU) jumped more than 17% to a record after its results, driving semiconductor stocks higher worldwide. The Philadelphia Semiconductor Index also climbed. Ben Barringer, who heads technology research at Quilter Cheviot, said “supply visibility and continued tightness support pricing” up and down the AI supply chain. Reuters
Onto is seeing its stock move quickly toward the targets set when it sold $1.5 billion in 0.00% convertible senior notes due 2031, according to an SEC filing. The company had issued the notes after buyers took up a $200 million overallotment. The conversion rate is 2.6192 shares for each $1,000 of principal, or about $381.80 a share.
The stock trades at $346.43, putting it 10.2% below its conversion price. A pre-2031 conversion trigger could kick in after the quarter ending Sept. 30, 2026, but only if shares top 130% of the conversion price for 20 days out of 30. That target is around $496.34, which is 43.3% higher than its Thursday afternoon mark.
The capped call is right above that trigger level. Onto put the cap price at $509.06 per share, up 46.9% from Thursday’s close and just 2.6% above the 130% conversion price. The filing said the capped calls are designed to limit dilution or offset cash payouts above the note principal, up to the cap.
This is important because the stock now trades near a financing line, not near where Wall Street sets its average target. Google Finance shows 11 Buys, no Holds or Sells, and an average one-year target of $358.82. That’s only 3.6% higher than where shares closed Thursday. The highest target is $450, but even that’s under the 130% trigger for the note.
Onto’s SEC filing puts the maximum make-whole share issuance at 5.89 million shares, or 11.8% of the company’s Q1 diluted weighted average share count of 50 million. That’s before considering anti-dilution adjustments or the capped calls. The company also spent around $205 million from note proceeds to buy back 805,325 shares at $254.53 each.
Onto’s numbers supported the stock’s recent gains. The company posted Q1 revenue of $291.9 million, up 9.5% year over year, and projected Q2 revenue between $320 million and $330 million. CEO Mike Plisinski pointed to “positive customer response” to its Dragonfly G5 inspection system and Atlas G6 metrology platform. Onto Innovation
Dragonfly G5 is still the piece buyers are coming for. Onto announced in April that it qualified the system for more and existing 2.5D advanced packaging work. First shipments are due in June. Plisinski said demand for Dragonfly tools has seen a “meaningful increase.” Onto Innovation
Next up is the quarter ending June 30. Onto is guiding for non-GAAP diluted EPS at $1.65 to $1.73, with a non-GAAP operating margin between 28% and 28.6%.
