Tuesday - Coherent , Inc. (NYSE:COHR) shares has had its price target increased by Stifel to $75.00, up from the previous $68.00, while the firm maintains a Buy rating on the stock.
The adjustment comes ahead of the company's fourth-quarter fiscal year 2024 earnings report, which is scheduled to be released after the market closes on Thursday, August 15.
Stifel anticipates Coherent's results to be in line with or slightly above consensus estimates, citing a continued recovery in a volatile demand environment.
The firm projects a year-over-year increase of 5.9% and a quarter-over-quarter improvement of 5.6%. For the first quarter of fiscal year 2025, Stifel expects Coherent's outlook to be modestly above consensus estimates, driven by ongoing momentum in AI transceiver sales.
Industry discussions reveal that Coherent's 800G transceiver backlog is strong, with capacity constraints potentially limiting growth through the end of the year.
Stifel forecasts a significant year-over-year revenue jump of 28.5% and a 2.1% increase from the previous quarter. The firm's outlook for Coherent is positive, with datacom tailwinds expected to contribute to long-term optimism.
The company's engagement with both current and next-generation transceiver products and expansion to new tier-1 CSP customers has reinforced Stifel's confidence in Coherent's long-term prospects. The firm's stance on the company's opportunities for secular growth remains unchanged, leading to the reiterated Buy rating and adjusted 12-month price target.
InvestingPro Insights
As Coherent, Inc. (NYSE:COHR) approaches its fourth-quarter earnings report, the company's recent performance and analysts' expectations offer a mixed picture. According to InvestingPro data, Coherent has experienced a significant return over the last week, with a 15.12% increase in price total return, indicating a potential uptick in investor sentiment. However, the company's revenue has seen a decline of 5.03% over the last twelve months as of Q3 2024, aligning with Stifel's caution about a volatile demand environment.
InvestingPro Tips highlight that while Coherent's stock price movements have been quite volatile, the company has strong liquidity, with liquid assets exceeding short-term obligations. This financial stability could reassure investors about the company's ability to navigate uncertain market conditions. Furthermore, analysts predict that Coherent will be profitable this year, which could be a driving factor behind Stifel's positive outlook and increased price target.
With the market cap standing at $10.17 billion and a high P/E ratio of 56.98, Coherent is trading at a valuation that suggests high expectations for future earnings growth. For investors looking for more in-depth analysis, there are additional InvestingPro Tips available, offering a comprehensive view of Coherent's financial health and market position.
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