Coherent: A Buy Driven By Robust AI Datacenter Optics Demand

2026-04-22 00:38:08 ET

Coherent ( COHR ) is positioned at the intersection of three technology pillars underpinning the AI infrastructure buildout—compound semiconductors, photonics, and optical networking. The company was able to execute a sharp turnaround following a difficult downcycle in FY2023-FY2024, which saw challenges integrating after the II-VI/Coherent merger and inventory corrections. Revenue has rebounded back to $5.8B in FY2025 and is expected to reach $6.95B/$8.78B in FY2026E/FY2027E with growth rates of 19.6%/26.3% Y/Y, respectively. Critically, EPS is expected to compound at an even faster rate at a 3-year CAGR of ~45% from FY2025 to FY2028E....

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