Coherent Corp (COHR) AI Stock Analysis

• Market Cap: $48.54B
• Dividend Yield: N/A
• Average Volume (3M): 5.36M
• Price to Earnings (P/E): 256.3
• Beta (1Y): 2.80
• Revenue Growth: 20.80%
• EPS Growth: N/A
• Country: US
• Employees: 26,157
• Sector: Technology
• Sector Strength: 88
• Industry: Hardware, Equipment & Parts
• EPS (TTM): 1.29
• Shares Outstanding: 187,481,860
• 10 Day Avg. Volume: 4,658,894
• 30 Day Avg. Volume: 5,362,861
• PEG Ratio: -3.90
• Price to Book (P/B): 1.70
• Price to Sales (P/S): 2.38
• P/FCF Ratio: 71.64
• Enterprise Value/Market Cap: 0.90
• Enterprise Value/Revenue: 6.95
• Enterprise Value/Gross Profit: 19.10
• Enterprise Value/Ebitda: 34.91
• 1Y Price Target: $243.64
• Price Target Upside: -5.91% Downside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 13
• EPS Forecast (FY): 5.34
• Revenue Forecast (FY): $6.94B

• Rating: 63 Neutral
• Price Target: $276.00 ▲(6.59% Upside)
• Action: Reiterated Date: 02/06/26
• Date: Action: Reiterated 02/06/26

The score is driven mainly by improving profitability and a strong, upbeat earnings outlook with exceptional data center demand and bookings, supported by a favorable technical uptrend. Offsetting this are weak free cash flow/cash conversion and a very high P/E that increases downside sensitivity if growth or margin execution disappoints.

Positive Factors

Strong Data Center & Communications Demand

A dominant revenue mix (>70%) and a book-to-bill >4x with orders extending into 2027 provide multi-year revenue visibility. This concentration in high-growth hyperscale/telecom end markets supports durable demand, greater predictability of capacity planning, and stronger secular tailwinds.

Improving Profitability and Record Revenue

Material margin and EPS improvement alongside record revenue indicate operating leverage is returning as volumes grow. Sustained gross margin expansion and improving operating margins support higher free cash generation potential if revenue trends continue and management hits long-term margin targets.

Six-inch Indium Phosphide Ramp and Cost Advantage

Scaling six-inch indium phosphide gives a structural cost and yield advantage that should be margin-accretive over time. Higher internal supply and lower per-chip costs reduce reliance on expensive external components, improving gross margins and competitive positioning as volume demand for optics grows.

Negative Factors

Negative Free Cash Flow and Weak Cash Conversion

Persistent negative FCF and weak cash-to-earnings conversion reduce financial flexibility and raise funding risk for growth investments. If cash conversion does not recover, the company may need ongoing external financing or slower reinvestment, increasing execution and liquidity risk over coming quarters.

Persistent Industry Indium Phosphide Supply Tightness

Prolonged supply constraints increase execution risk and may limit the company’s ability to meet booked demand. Sustained tightness can force higher input costs, prioritization of customers, or delayed shipments, undermining revenue realization and margin improvement despite strong bookings.

High CapEx and Elevated Operating Spend to Scale

Ongoing heavy CapEx and rising OpEx to expand capacity and ramp new fabs pressures near-term cash flow and return metrics. The capital intensity means profitability gains must be sustained to justify investment; otherwise returns on capital and free cash flow will remain constrained.

Coherent Corp Business Overview & Revenue Model

Company Description

Coherent, Inc. provides lasers, laser-based technologies, and laser-based system solutions for a range of commercial, industrial, and scientific research applications. It operates in two segments, Original Equipment Manufacturers (OEM) Laser Sources and Industrial Lasers & Systems. The company designs, manufactures, markets, and services lasers, laser tools, precision optics, and related accessories; and laser measurement and control products. Its products are used for applications in microelectronics, materials processing, OEM components and instrumentation, and scientific research and government programs. The company markets its products through a direct sales force in the United States, as well as through direct sales personnel and independent representatives internationally. Coherent, Inc. was founded in 1966 and is headquartered in Santa Clara, California. As of July 1, 2022, Coherent, Inc. operates as a subsidiary of II-VI Incorporated.

How the Company Makes Money

Coherent Corp generates revenue through the sale of its laser systems and components, which are utilized across various industries for applications such as cutting, welding, and marking materials. Key revenue streams include direct sales of laser products, systems integration services, and recurring revenue from maintenance and support contracts. The company also benefits from partnerships with technology firms and research institutions that enhance its product offerings and market reach. Additionally, Coherent capitalizes on innovation in photonics technology, driving demand for higher-performance solutions in emerging markets.

Coherent Corp Financial Statement Overview

Summary

Earnings and margins improved meaningfully in the TTM with revenue growth and a return to solid net income, and leverage metrics are trending better. The major offset is weak cash quality: free cash flow is sharply negative (TTM -$154M) and cash conversion is low, which raises flexibility risk if it persists.

Income Statement

TTM (Trailing-Twelve-Months) revenue is up (~4.2%), and profitability improved materially versus recent annual results, with net income turning solidly positive ($293M TTM vs. $49M in FY2025 and losses in FY2024–FY2023). Gross margin is healthy (~36%) and operating profitability is reasonable (operating margin ~11%, EBITDA margin ~20%), showing better cost control and operating leverage. Offsetting this, net margin remains modest (~4%) and results have been volatile over the last several years (profits in FY2021–FY2022, losses in FY2023–FY2024), which lowers confidence in the durability of the current upswing.

Balance Sheet

Leverage looks manageable on the latest periods, with debt-to-equity improving versus prior years (TTM ~0.42 vs. ~0.62 in FY2023), and equity has grown alongside a larger asset base. However, returns on equity remain low (TTM ~3.1%), reflecting that while profitability has recovered, it is not yet strong relative to the capital employed. Overall, the balance sheet appears adequate and improving, but still not generating particularly attractive returns.

Cash Flow

Cash generation is the key weak spot. Despite positive operating cash flow in TTM, free cash flow is sharply negative (TTM -$154M), a major swing from consistently positive free cash flow in the annual periods shown. In addition, operating cash flow covers only a modest portion of accounting earnings in TTM (coverage ~0.30), indicating weaker cash conversion. The combination of negative free cash flow and weaker cash-to-earnings support increases financial flexibility risk if sustained.

Breakdown	TTM	Jun 2025	Jun 2024	Jun 2023	Jun 2022	Jun 2021
Income Statement
Total Revenue	6.29B	5.81B	4.71B	5.16B	3.32B	3.11B
Gross Profit	2.29B	2.06B	1.46B	1.78B	1.27B	1.18B
EBITDA	1.25B	1.11B	682.94M	961.67M	689.84M	672.19M
Net Income	293.44M	49.36M	-156.15M	-259.46M	234.76M	297.55M
Balance Sheet
Total Assets	15.09B	14.91B	14.49B	13.71B	7.84B	6.51B
Cash, Cash Equivalents and Short-Term Investments	863.74M	909.20M	926.03M	821.31M	2.58B	1.59B
Total Debt	3.55B	3.89B	4.30B	4.49B	2.44B	1.53B
Total Liabilities	6.20B	6.43B	6.54B	6.48B	3.46B	2.38B
Stockholders Equity	8.54B	8.13B	7.57B	7.23B	4.38B	4.13B
Cash Flow
Free Cash Flow	-103.62M	192.76M	198.91M	197.97M	99.00M	428.02M
Operating Cash Flow	397.10M	633.60M	545.73M	634.02M	413.33M	574.35M
Investing Cash Flow	-84.16M	-414.21M	-350.71M	-5.93B	-320.08M	-172.96M
Financing Cash Flow	-563.68M	-451.73M	758.27M	3.55B	862.95M	675.73M

Coherent Corp Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 258.93
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: 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 258.93 is above the 20-day moving average (MA) of 232.24, above the 50-day MA of 207.71, and above the 200-day MA of 134.86, indicating a bullish trend. The MACD of 14.48 indicates Negative momentum. The RSI at 64.22 is Neutral, neither overbought nor oversold. The STOCH value of 75.66 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for COHR.

Coherent Corp Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
JBL	73 Outperform	$27.98B	41.22	47.87%	0.14%	13.18%	-38.37%
FLEX	72 Outperform	$23.17B	28.21	16.85%	―	0.77%	0.51%
MKSI	69 Neutral	$16.44B	56.10	11.74%	0.54%	8.13%	780.20%
FTV	67 Neutral	$18.23B	34.20	7.78%	0.43%	-8.96%	-30.29%
COHR	63 Neutral	$48.54B	256.26	3.63%	―	20.80%	―
TRMB	63 Neutral	$15.64B	37.99	7.32%	―	-0.86%	-75.37%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%

Coherent Corp Corporate Events

Coherent Corp Delivers Strong Q2 2026 Earnings Growth

On February 4, 2026, Coherent Corp. reported its financial results for the second quarter of fiscal 2026, ended December 31, 2025, posting revenue of $1.69 billion, up 17% year over year, or 22% on a pro forma basis excluding the divested aerospace and defense business. GAAP gross margin improved to 36.9% and non-GAAP gross margin to 39.0%, while GAAP earnings per share rose 71% to $0.76 and non-GAAP EPS climbed 35% to $1.29, driven primarily by strong demand in the datacenter and communications segment and supported by improving industrial demand. Management highlighted that the combination of significant revenue growth and margin expansion boosted profitability and is prompting increased capital investment to expand production capacity, underscoring Coherent’s strengthening position in core photonics markets and its intent to support sustained growth into the second half of fiscal 2026 and beyond.

The most recent analyst rating on (COHR) stock is a Hold with a $229.00 price target. To see the full list of analyst forecasts on Coherent Corp stock, see the COHR Stock Forecast page.

Coherent Corp Announces Business Realignment

Coherent Corp. announced a realignment of its business operations into two segments: Datacenter & Communications and Industrial, effective from July 1, 2025. This change, which was disclosed in a report dated August 15, 2025, aims to streamline operations based on product and service similarities. The company has provided recast historical financial information to reflect this new segment structure, which does not impact its historical financial position or cash flows. The reorganization is expected to enhance operational efficiency and align with market demands, potentially benefiting stakeholders by improving the company’s industry positioning.

The most recent analyst rating on (COHR) stock is a Hold with a $210.00 price target. To see the full list of analyst forecasts on Coherent Corp stock, see the COHR Stock Forecast page.