Northcoast Research Maintins Bullish View on IPG Photonics (IPGP), Coherent (COHR) Amid October Laser Survey, Tesla Semi Offering
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Northcoast Research analyst Tom Hayes weighed in on IPG Photonics (NASDAQ: IPGP) and Coherent, Inc. (NASDAQ: COHR) after their October laser survey pointed to a good start to the quarter.
Hayes notes that earlier this month they visited IPG Photonics and Coherent at Fabtech and they saw the continued expansion of laser products and applications. "We believe this combination is a key driver of their continued success as the addressable markets for lasers continues to expand as solutions become more robust and affordable," he commented.
The analyst said despite significantly outperformance, catalysts for significant long-term growth remain in place and in fact are likely to accelerate over the next 12-24 months.
The firm's survey work gives them increased confidence that the demand trends remain healthy and momentum is strong as we progress through the fourth quarter of 2017. 75% of respondents indicated fiber as the laser type manufactured, sold or used. Meanwhile, 56% of respondents that chose CO2 represents one of the lowest percentages of users since inception of the survey. October activity was impressive as 41% of respondents indicated growth of over 7.5%.
IPG Photonics and Coherent remains two of their top ideas and with valuations that remain attractive.
In a separate note, the analyst highlights that Tesla's Semi offering will expand the demand for lithium batteries and IPG Photonics and Coherent are posted to benefit.
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