NEW YORK, May 23, 2026, 14:02 EDT
Coherent Corp. ended Friday at $377.57, off 0.1% and down about 1.3% from last week’s May 15 close. The shares saw a big drop Monday, then bounced Thursday as AI-optics names rallied into the holiday break.
Tight timing for U.S. equities. Markets are closed for the weekend, and Nasdaq says Monday, May 25 is off for Memorial Day. That makes Tuesday the earliest day investors can reopen trades in Coherent and other fast-networking suppliers.
The stock underperformed as the market moved higher. The S&P 500 gained 0.9% this week, the Nasdaq was up 0.5%, and the wider U.S. market posted its eighth weekly win in a row, based on AP’s market data.
Coherent’s problem isn’t seeing demand—it’s knowing how much of that is priced in. The company posted fiscal third-quarter revenue of $1.81 billion, up 21% from a year ago. Non-GAAP earnings per share came in at $1.41. Non-GAAP, or adjusted, numbers exclude some costs and items that can affect year-over-year comparisons.
Coherent CEO Jim Anderson said the company is seeing “exceptionally strong demand” in datacenter and communications. CFO Sherri Luther said Coherent is “ramping our capital investment” to add capacity. GlobeNewswire
Anderson told analysts on the earnings call that customer demand was steady with “no signs of attenuation” and orders now stretching into 2028. He highlighted indium phosphide as a “key constraint” for the company and said they’re working to ease this with more capacity. Investing.com
Transceivers are the products in focus for investors. These are devices that turn electrical signals into light for fiber-optic links. BofA Securities lifted its Coherent price target to $400 from $365 this month, keeping its Neutral rating. The move points to Coherent’s position in 800G and 1.6T transceivers, meaning 800-gigabit and 1.6-terabit-per-second rates now used in faster AI-driven data-center networks.
Lumentum and Applied Optoelectronics are still moving with Coherent in the optical-networking group. Both climbed midweek as AI data-center names caught bids after a selloff on Monday. The drop followed filings showing a major AI investor left positions in Coherent and Lumentum. The competitive setup remains tight.
Nvidia remains a key factor. In its latest quarterly filing, Coherent said Nvidia put $2 billion into the company on March 2 and signed a multi-year agreement. The deal covers advanced optics, manufacturing and R&D tied to next-gen AI infrastructure.
But there are real risks. Coherent trades at almost 179 times trailing earnings—an elevated price-to-earnings multiple. Any setback in scaling up capacity, softer cloud demand, or squeezed margins in high-speed optical parts could knock the stock lower. The company flagged in its latest quarterly filing that trade issues could mean hits to revenue, pricier materials or even production delays.
Short week for U.S. markets after Monday’s holiday, but it won’t be slow. Traders get consumer confidence numbers, jobless claims, and an updated Q1 GDP. That data could set the mood for growth stocks, with eyes on Coherent before company news lands.
