11 Best Semiconductor Equipment Stocks to Buy According to Analysts

1. Onto Innovation Inc. (NYSE:ONTO)

Average Upside Potential: ~102.7%

Number of Hedge Fund Holders: 50

Onto Innovation Inc. (NYSE:ONTO) is a leading player in the broader semiconductor industry as it specializes in design, manufacturing, development, and support of metrology as well as inspection tools critical for the semiconductor device fabrication. Stifel analysts maintained a “Buy” rating on the company’s stock, with the firm expecting growth in 2025 to be mainly aided by its wafer fabrication equipment (WFE)-oriented advanced nodes business. This business continues to gain traction in terms of customer, market, and product momentum.

The firm’s analysts believe that Onto Innovation Inc. (NYSE:ONTO) will outperform the overall industry growth in 2025, thanks to the strategies to penetrate new market opportunities as well as defend the existing positions. Overall, the growth in the semiconductor equipment market continues to fuel demand for Onto Innovation Inc. (NYSE:ONTO)’s advanced metrology, inspection, and lithography tools, with chipmakers continuing to adopt complex manufacturing processes and enhance the global fab capacity. Furthermore, dynamic trends, including AI and specialty semiconductors, have been enhancing its total addressable market.

Invesco Distributors, Inc., an investment management firm, released its Q4 2024 investor letter. Here is what the fund said:

“Onto Innovation Inc. (NYSE:ONTO): The company is a semiconductor capital equipment manufacturer that provides process control solutions for microelectronics manufacturing, including defect inspection, metrology systems and software to enhance yield and reduce costs. The company has benefited from the artificial intelligence (AI) boom, but weakness during the quarter provided an attractive entry point for the fund.”

While we acknowledge the potential of ONTO as an investment, our conviction lies in the belief that some deeply undervalued AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. There is an AI stock that went up since the beginning of 2025, while popular AI stocks lost around 25%. If you are looking for a deeply undervalued AI stock that is more promising than ONTO but that trades at less than 5 times its earnings, check out our report about this cheapest AI stock.

READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires.

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