Coherent stock rating reiterated at Buy by Benchmark on AI growth

Published 17/07/2025, 13:42
Coherent stock rating reiterated at Buy by Benchmark on AI growth

Investing.com - Benchmark maintained its Buy rating on Coherent (NYSE:COHR) on Thursday, citing strong growth in the artificial intelligence and datacenter sectors. The company’s stock has shown impressive momentum, gaining 29% over the past year. According to InvestingPro data, analysts maintain a bullish consensus with a mean price target suggesting further upside potential.

The research firm highlighted that major hyperscale capital expenditure is expected to increase by approximately 40% year-over-year to about $322 million in 2025, with AI and datacenter demand remaining the primary growth driver in the space. This aligns with Coherent’s recent performance, as InvestingPro data shows revenue growth of 21.7% in the last twelve months, with analysts forecasting 23% growth for fiscal year 2025.

This surge in spending has already benefited other technology companies, with Seagate shares rising 76% and Western Digital (NASDAQ:WDC) shares gaining 64% since April 1, 2025.

Benchmark expects the continued strength in datacenter sales to similarly support Coherent’s business performance and stock price.

The firm’s analysis suggests Coherent is well-positioned to capitalize on the ongoing expansion in AI infrastructure and datacenter investments throughout 2025.

In other recent news, Coherent Corp. has experienced significant developments, beginning with a revised outlook from S&P Global Ratings. The agency upgraded Coherent’s outlook to stable from negative, citing strong demand for its datacom transceivers, which contributed to a revenue increase of over 20% year-over-year as of the third quarter of fiscal year 2025. Coherent has also been actively reducing its debt, paying down more than $200 million over the past three fiscal quarters. The company’s focus on operational efficiency has led to expanded EBITDA margins and is expected to further reduce leverage in the coming years. Coherent introduced several new products, including the Osprey femtosecond laser for medical applications and a line of disposable surgical fiber assemblies. The company also unveiled the LEAP 600C, a 600-watt excimer laser for high-temperature superconducting tapes, and an 18W laser diode for diode-pumped solid-state lasers. These product launches reflect Coherent’s continued innovation in photonics solutions for various industrial and medical applications.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

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