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Coherent Corp. (COHR)
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Coherent Corp (COHR) AI Stock Analysis

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COHR

Coherent Corp

(NYSE:COHR)

Rating:60Neutral
Price Target:
$100.00
▲(2.21% Upside)
Coherent Corp's overall stock score reflects a mixed financial performance with strong revenue growth and cash flow generation but is offset by low profitability margins and high leverage. Technical indicators suggest bearish momentum, and valuation metrics are unattractive due to a negative P/E ratio. The earnings call provided positive guidance and strategic advancements, which are significant positives.
Positive Factors
AI and Data Center Expansion
Coherent remains a primary beneficiary of the ongoing AI data center expansion and is actively reshaping its product portfolio.
Revenue Growth
Coherent noted continued strength for 800G transceivers with revenue expected to increase next year.
Negative Factors
Competitive Pricing Pressure
Rising competition in optical transceivers is leading to competitive pricing, potentially dragging down gross margins.
Growth Headwinds
COHR's sale of its aerospace and defense business creates significant growth headwinds, with the new Apple contract only expected to contribute in the future.

Coherent Corp (COHR) vs. SPDR S&P 500 ETF (SPY)

Coherent Corp Business Overview & Revenue Model

Company DescriptionCoherent Corp (COHR) is a global leader in photonics, providing laser-based solutions and optical components for a variety of industries, including communications, industrial manufacturing, and life sciences. The company specializes in high-performance lasers, laser-based systems, and precision optics, catering to diverse applications such as materials processing, medical diagnostics, and telecommunications. With a strong emphasis on innovation and technology, Coherent Corp plays a pivotal role in advancing the capabilities of photonic technologies across multiple sectors.
How the Company Makes MoneyCoherent Corp generates revenue primarily through the sale of laser systems and components, which are critical in various applications within industrial, scientific, and medical sectors. Key revenue streams include the manufacture and sale of laser products, optics, and related accessories. The company also benefits from recurring revenue through service contracts and maintenance agreements for its systems. Significant partnerships with major technology companies enhance its market reach and contribute to its earnings, as these collaborations often lead to joint product development and access to new markets. Additionally, Coherent Corp invests in research and development to drive innovation, which helps maintain its competitive edge and supports long-term revenue growth.

Coherent Corp Earnings Call Summary

Earnings Call Date:Aug 13, 2025
(Q4-2025)
|
% Change Since: |
Next Earnings Date:Nov 05, 2025
Earnings Call Sentiment Positive
The earnings call revealed strong growth in revenue and several strategic advancements, including new product launches and successful debt reduction. However, challenges in the industrial markets and foreign exchange impacts on gross margin present areas of concern.
Q4-2025 Updates
Positive Updates
Record Revenue and Growth in Fiscal 2025
Full year revenue increased by approximately 23% year-over-year to a record $5.81 billion, driven by strong growth in the data center and communications business.
Significant Growth in Data Center and Communications
Data center revenue grew by 61% for the full year and 38% year-over-year in Q4. Communications revenue increased 23% for fiscal '25, with a 42% year-over-year increase in Q4.
Launch of New Products and Expansions
Initial revenue shipments of new 1.6T Transceivers and Optical Circuit Switch began in fiscal Q4, with further ramp expected. A new multiyear agreement with Apple for VCSEL products was also announced.
Successful Debt Reduction and Financial Health
Paid down $437 million in debt over the fiscal year, reducing the debt leverage ratio to 2x from 2.5x.
Indium Phosphide Production Milestone
Production began on the world's first 6-inch indium phosphide line in Sherman, Texas, expected to provide significant cost and volume advantages.
Negative Updates
Decline in Industrial-Related End Markets
Industrial-related revenue decreased 2% for the year and 8% year-over-year in Q4, impacted by a decline in the silicon carbide business.
Gross Margin Impact from Foreign Exchange
Q4 non-GAAP gross margin was down 43 basis points sequentially, primarily due to unfavorable foreign exchange impacts.
Cautious Outlook for Industrial Segment
Taking a cautious view on the industrial market due to macroeconomic uncertainty and tariff concerns, expecting Industrial to be flat to down sequentially in the near term.
Company Guidance
During the call, Coherent Corp provided guidance for the first quarter of fiscal 2026, with expectations for revenue to range between $1.46 billion and $1.6 billion, reflecting the exclusion of approximately $20 million in revenue from the Aerospace and Defense business due to its anticipated sale. The non-GAAP gross margin is expected to be between 37.5% and 39.5%, with total operating expenses projected between $290 million and $310 million. The company anticipates a tax rate of 18% to 22% on a non-GAAP basis, and non-GAAP EPS is expected to be between $0.93 and $1.13. Coherent also shared progress on their new 6-inch indium phosphide production line, which commenced in August 2025, and discussed their expanded partnership with Apple, with revenue expected to begin in the second half of calendar 2026.

Coherent Corp Financial Statement Overview

Summary
Coherent Corp shows a mixed financial performance with strengths in revenue growth and cash flow generation. However, profitability margins and high leverage remain areas of concern. The company needs to focus on improving operational efficiencies and managing debt levels to enhance financial stability and shareholder value.
Income Statement
65
Positive
Coherent Corp has shown a positive revenue growth rate of 3.84% in the TTM, indicating a recovery from the previous year's decline. The gross profit margin has improved to 35.16%, reflecting efficient cost management. However, the net profit margin remains low at 0.85%, suggesting challenges in translating revenue growth into net income. The EBIT margin is notably low, indicating potential operational inefficiencies.
Balance Sheet
58
Neutral
The company's debt-to-equity ratio has increased to 1.57, indicating higher leverage and potential financial risk. Return on equity is low at 0.77%, reflecting limited profitability relative to shareholder equity. The equity ratio is stable, suggesting a balanced asset structure, but the high debt levels could pose risks if not managed carefully.
Cash Flow
72
Positive
Coherent Corp has achieved a significant free cash flow growth rate of 50.79% in the TTM, demonstrating strong cash generation capabilities. The operating cash flow to net income ratio is healthy at 0.63, indicating good cash conversion efficiency. However, the free cash flow to net income ratio is moderate, suggesting room for improvement in cash profitability.
BreakdownTTMDec 2025Dec 2024Dec 2023Dec 2022Dec 2021
Income Statement
Total Revenue5.81B5.81B4.71B5.16B3.32B3.11B
Gross Profit2.04B2.04B1.46B1.62B1.27B1.18B
EBITDA668.51M668.51M700.59M613.00M689.84M682.56M
Net Income49.40M49.40M-156.15M-259.46M234.76M297.55M
Balance Sheet
Total Assets14.91B14.91B14.49B13.71B7.84B6.51B
Cash, Cash Equivalents and Short-Term Investments909.20M909.20M926.03M821.31M2.58B1.59B
Total Debt3.89B3.89B4.30B4.49B2.44B1.53B
Total Liabilities6.43B6.43B6.54B6.48B3.46B2.38B
Stockholders Equity8.13B8.13B7.57B7.23B4.38B4.13B
Cash Flow
Free Cash Flow386.40M192.76M198.91M197.97M99.00M428.02M
Operating Cash Flow1.14B633.60M545.73M634.02M413.33M574.35M
Investing Cash Flow-697.46M-414.21M-350.71M-5.93B-320.08M-172.96M
Financing Cash Flow-837.83M-451.73M758.27M3.55B862.95M675.73M

Coherent Corp Technical Analysis

Technical Analysis Sentiment
Positive
Last Price97.84
Price Trends
50DMA
96.96
Positive
100DMA
85.30
Positive
200DMA
85.86
Positive
Market Momentum
MACD
-1.72
Negative
RSI
53.56
Neutral
STOCH
68.23
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For COHR, the sentiment is Positive. The current price of 97.84 is above the 20-day moving average (MA) of 95.71, above the 50-day MA of 96.96, and above the 200-day MA of 85.86, indicating a bullish trend. The MACD of -1.72 indicates Negative momentum. The RSI at 53.56 is Neutral, neither overbought nor oversold. The STOCH value of 68.23 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for COHR.

Coherent Corp Risk Analysis

Coherent Corp disclosed 35 risk factors in its most recent earnings report. Coherent Corp reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks

Coherent Corp Peers Comparison

Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
74
Outperform
$6.83B25.8511.12%0.84%4.47%2887.37%
74
Outperform
$20.89B24.4417.67%-3.63%2.26%
72
Outperform
$18.97B68.065.06%-3.72%-80.83%
72
Outperform
$16.20B21.617.36%0.47%-0.12%-11.27%
67
Neutral
$22.32B40.4332.41%0.15%-6.13%-53.35%
61
Neutral
$35.52B8.84-11.06%1.87%8.55%-8.14%
60
Neutral
$14.90B0.63%23.42%71.17%
* Technology Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
COHR
Coherent Corp
97.84
27.04
38.19%
FLEX
Flex
55.66
26.90
93.53%
JBL
Jabil
210.10
107.62
105.02%
MKSI
MKS
104.49
-0.17
-0.16%
TRMB
Trimble
80.74
26.43
48.67%
FTV
Fortive
47.87
-6.37
-11.74%

Coherent Corp Corporate Events

M&A TransactionsBusiness Operations and StrategyFinancial Disclosures
Coherent Corp Reports Record Revenue for FY 2025
Positive
Aug 13, 2025

On August 13, 2025, Coherent Corp. reported its financial results for the fourth quarter and full fiscal year 2025, ending June 30, 2025. The company achieved a record annual revenue of $5.81 billion, marking a 23% year-over-year increase, and improved its non-GAAP gross margin to 37.9%. Despite a GAAP net loss, the non-GAAP earnings per share showed significant improvement. The company also announced plans to sell its Aerospace and Defense business, focusing on long-term growth opportunities.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Sep 05, 2025