Key Stats for Coherent Stock
- Current Price: $302.35
- Target Price (Mid): ~$1,130
- Street Target: ~$413
- Potential Total Return: ~275%
- Annualized IRR: ~32% / year
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What Happened?
Coherent Corp. (COHR) closed at $302.35 on Thursday, October 8, down 9.63% in a broad pullback across optics stocks. Before the open, Coherent was down more than 3%, with Lumentum (LITE), Credo (CRDO), Corning (GLW), and Marvell Technology (MRVL) also lower, as rising Treasury yields, higher oil prices, and Fed rate-hike signals fed doubts about AI spending. No company-specific catalyst was reported. The close left Coherent 23% below its June 30 level, even as consensus revenue for fiscal 2027 and 2028 rose.
Down 23% Since June, With Forecasts Up 11% to 14%
Coherent closed fiscal 2026 on June 30 at $394.47. Between June 30 and September 30, consensus revenue for fiscal 2027 (ending June 2027) rose from $9.57 billion to $10.63 billion. The fiscal 2028 estimate rose from $12.92 billion to $14.76 billion. Much of that lift came after the August 12 earnings report, when Coherent’s investor relations materials guided fiscal Q1 2027 revenue to $2.2 billion to $2.4 billion. Analysts expect about $2.30 billion.
With the price falling and estimates rising, Coherent’s P/E ratio on next-twelve-months normalized earnings dropped from 53x on June 30 to around 32x. That sits below Corning’s 41x and above Fabrinet’s (FN) 27x. The stock is still up 64% in 2026, so the reset trimmed a large run rather than erasing it.
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Several Ramps Begin Inside Fiscal 2028
Fiscal 2028 runs from July 2027 to June 2028. Its estimate rose the most between June 30 and September 30. At the September 21 European Conference on Optical Communication, CEO Jim Anderson said near-packaged optics and co-packaged optics for scale-up networks both begin ramping in the second half of calendar 2027, within that fiscal year. Co-packaged optics for scale-out networks start earlier, in the December 2026 quarter.
Anderson also sized the dollars per system. His example was a chip needing 100 terabits of I/O on 200-gig lanes. In that case, he said, “the content for Coherent would be up to about $15,000 per system or per 100T chip” when Coherent supplies the full solution. That is an illustrative ceiling, not a contracted price.
Customers are also signing multi-year agreements. Beck Mason, EVP of Semiconductor Devices, said Coherent has two long-term agreements with leading hyperscale AI customers for its ultra-high-power lasers. Julie Eng, EVP of Optical Components and CTO, said customers are “securing capacity for garnet and isolators with long-term agreements.” She added that isolators are becoming a key component in the co-packaged and near-packaged ramp.
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TIKR Advanced Model Analysis
- Current Price: $302.35
- Target Price (Mid): ~$1,130
- Potential Total Return: ~275%
- Annualized IRR: ~32% / year
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TIKR’s mid-case values Coherent at around $1,130 by June 30, 2031. That is a total return of about 275% from $302.35, or around 32% a year over 4.7 years. Getting there requires the fiscal 2028 ramps to arrive on schedule and keep compounding. Consensus in TIKR has revenue near $19.2 billion by fiscal 2029, with normalized net margins around 21%.
The ramps cost cash first. Consensus has fiscal 2027 free cash flow at around negative $700 million on about $1.75 billion of capex, turning positive in fiscal 2028. The bigger risk is how thin the later estimates are. Six analysts cover fiscal 2029, and that estimate fell about 5% between June 30 and September 30 as coverage widened from one analyst to six. Only one analyst covers fiscal 2030 and 2031. The nearer reference point is the Street’s mean target of around $413, about 36% above the current price.
Conclusion
Coherent’s fiscal Q1 report, expected in mid-November but not yet confirmed, sets three markers. Revenue should land against the roughly $2.30 billion consensus. Non-GAAP gross margin should land within the 39.5% to 41.5% guide. The December-quarter outlook should clear the around $2.53 billion that analysts expect. An outlook below that would put both the higher fiscal 2028 estimates and the reset multiple back in question.
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any stocks mentioned. Thank you for reading, and happy investing!
