Coherent Corp. Raises PT to $105, Maintains Outperform Rating

Coherent Corp. (NYSE:COHR) has been upgraded to $105 PT and maintained an Outperform rating by Northland after a "slightly better" than expected Q4 results. The firm notes that Coherent trades at a 35% discount to peers Lumentum and Fabrinet, and sees potential for gains following the stock's weakness in the after-market.

Coherent Corp. (NYSE:COHR), an industrial technology company specializing in lasers and transceivers, has seen its stock price upgraded to $105 PT with an Outperform rating by Northland. This upgrade comes following a "slightly better" than expected Q4 results. The firm notes that Coherent trades at a 35% discount to its peers Lumentum and Fabrinet, presenting potential for gains following the stock's weakness in the after-market.

Coherent Corp. reported a 16% year-over-year (YoY) increase in revenue for the quarter, driven primarily by strong demand in AI data centers and networking segments. Despite the impressive results, the company's cautious guidance for the next quarter raised concerns among investors, leading to a post-market stock drop of 20% [2].

Analysts remain optimistic about Coherent's growth prospects. Chris Lau of Reuters upgraded the stock, citing potential growth in AI data centers and the company's new product lines. The analyst noted that Coherent's 39% YoY revenue growth in its networking business was particularly strong, driven by a 39% surge in AI-driven networking business to $945 million [2]. The company's planned sale of its defense laser business for $400 million, which will be used to pay down a portion of its $3.7 billion debt, further highlights its strategic focus on reducing debt and investing in growth areas.

The average one-year price target for COHR stock is $109.96, indicating significant upside potential. However, GuruFocus estimates suggest a potential downside, highlighting diverse perspectives on COHR's stock value. Despite the cautious outlook, Coherent's focus on innovation and strategic investments in key growth areas positions it for long-term success. The company's strong demand for optical networking equipment from AI data centers and potential collaborations with leading AI companies like NVIDIA further underscore its growth potential [3].

Coherent Corp. has seen its stock price range between $45.58 and $123.25 in the past 12 months, with a market cap of $14.52B and an enterprise value of $19.70B. The company's upcoming earnings report is scheduled for November 5, 2025 [3]. The stock has been a beneficiary of the AI momentum, benefiting from its transceivers being a key component of the AI tech stack. However, rising competition in optical transceivers is leading to competitive pricing, potentially dragging down gross margins [3].

References:
[1] https://finance.yahoo.com/news/coherent-corp-cohr-guidance-miss-171010374.html
[2] https://www.ainvest.com/news/coherent-corp-upgrade-analyst-highlights-growth-potential-upside-2508/
[3] https://www.tipranks.com/stocks/cohr