Coherent Corp Shares Cross Below 200-Day Moving Average

Coherent Corp (COHR) shares crossed below their 200-day moving average of $86.38, trading as low as $84.35. Shares are currently down 3.3% on the day. The 52-week range for COHR is $45.58 to $123.25, with a last trade of $84.96.

Coherent Corp (COHR) shares crossed below their 200-day moving average of $86.38, trading as low as $84.35 on July 2, 2025. The stock is currently down 3.3% on the day, with the 52-week range for COHR spanning from $45.58 to $123.25, and a last trade of $84.96 [1][2].

The recent decline in COHR's stock price follows a period of slowing growth in the company's data center segment. Despite reporting strong fiscal Q4 results, including a record revenue of $1.53 billion and an adjusted net income of $192 million, concerns have emerged regarding the deceleration of growth in the data center segment [1]. Analyst Vivek Arya from Bank of America Securities highlighted a notable decrease in revenue growth in this segment, downgrading Coherent's stock from buy to neutral [1].

Coherent's fiscal Q1 forecast projects revenue between $1.46 billion and $1.6 billion, with adjusted EPS anticipated to range between $0.93 and $1.13 [1]. The company's current market capitalization stands at approximately $14.25 billion, with a Price-to-Book (PB) ratio close to its 10-year high at 2.66, indicating valuation concerns [1]. The GF Value suggests that Coherent is significantly overvalued, with a GF Value of $60.82 and a target price of $104.13 [1].

The stock's decline has been fueled by a surge in leveraged put options and aggressive shorting, with the COHR20250822P88 put option (strike $88) seeing 629 contracts traded with a 70.45% leverage ratio [2]. The -20.12% intraday drop aligns with the bearish 'engulfing' candlestick pattern, indicating a potential breakdown below key support levels [2].

Coherent's stock is categorized as a Speculative Growth stock and is part of the Mid Growth style box. Its growth and financial health grades are both rated as 'C', while profitability is rated 'F' [1]. The company's Return on Invested Capital (ROIC) is below its Weighted Average Cost of Capital (WACC), indicating potential capital inefficiency [1].

Despite the recent decline, Coherent's strategic position in the optical networking revolution and its potential in AI data centers remain promising. The company's next-generation Optical Circuit Switch (OCS) platform, which includes non-mechanical switching and ECOC 2024 recognition, expands Coherent's addressable market to $2 billion for AI data centers [3]. However, the slowing data center growth and near-term revenue headwinds mean that patience is required for strategic bets.

Investors should closely monitor COHR's ability to hold above its 200-day moving average at $86.50. A breakdown below this level could validate the bearish engulfing pattern and open the door to a 15-20% move toward $85 support [2]. Conversely, a rebound above 93.32 (Bollinger Band) could spark a short-covering rally.

References:
[1] https://www.gurufocus.com/news/3063374/coherent-cohr-stock-dips-amid-slowing-growth-concerns
[2] https://www.ainvest.com/news/coherent-plummets-20-8-bearish-storm-unleashed-industrial-machinery-2508/
[3] https://www.ainvest.com/news/coherent-corp-shares-drop-20-market-concerns-positive-analyst-outlook-2508/