COHR Stock Pulls Back After Thermal Innovation-Led Rally – Retail Is Calling For More Upside

Coherent said Monday that its customers had begun sampling its new 300mm high-thermal-conductivity SiC substrates.

• COHR stock gained nearly 8% on Monday before paring some gains in the overnight session. 
• Chipmakers and AI infrastructure players are seen to be the biggest beneficiaries of the Big Tech capex boom.
• Retail sentiment for COHR was ‘extremely bullish,’ unchanged since the company issued its quarterly report last Wednesday.

Coherent Corp.’s stock declined nearly 3% in overnight trading ahead of Tuesday, paring some of the gains from the regular session after the company discussed progress on a new technology.

COHR shares rose nearly 8% in Monday’s session after Coherent said its semiconductor clients had begun sampling the company's new 300mm high thermal conductivity silicon carbide, or SiC, substrates.

Coherent makes optical and semiconductor technologies used in areas such as AI data centers, communications and industrial applications. Its new 300mm SiC substrates are designed to handle high heat and power more efficiently, helping semiconductor makers build more powerful and energy-efficient chips.

A substrate is the base material or platform on which a semiconductor device or chip is built. Coherent said the new substrates are engineered to improve heat spreading by up to 20% more than current solutions.

“By combining decades of silicon carbide expertise with a scalable 300mm manufacturing platform, Coherent is helping build the materials foundation for future AI infrastructure," the company said in a statement on Monday. 

The rise and fall comes amid optimism following its recent quarterly report and broader enthusiasm for the photonics technology segment.

Coherent’s Q4 Recap

Coherent issued stronger-than-expected fourth quarter (Q4) results and issued an upbeat outlook last Wednesday, promoting a series of price target hikes from analysts. 

Revenue surged 34% to $2.05 billion, surpassing Wall Street’s expectations of $1.99 billion. Adjusted earnings of $1.74 a share were also above analysts’ consensus estimate of $1.62.

The guidance was solid. The company expects adjusted earnings per share of $1.85 to $2.05 in the first quarter of fiscal 2027 on revenue of $2.3 billion at the midpoint. Analysts had forecast adjusted earnings of $1.77 a share and revenue of $2.14 billion.

Photonics stocks are seeing massive demand and valuation gains as hyperscalers increase spending on optical transceivers, switches, and fiber-optic cabling to address speed bottlenecks in AI data centers.

Retail View On COHR, Photonic Stocks

On Stocktwits, the retail sentiment for COHR was ‘extremely bullish,’ unchanged since the company’s earnings report, with several traders posting about the Monday Sic chip announcement. “$COHR Next week we fly to the moon, the only limit is the sky,” a trader said.

Coherent competes with Applied Optoelectronics, POET, and Lumentum Holdings in the optical networking and photonics market.

Shares of the four companies climbed sharply for most of the year, before a pullback starting in May. Applied Optoelectronics and Lumentum remain the top performers in the group, with 344% and 163% year-to-date gains, respectively.

POET shares are up about 49%, with the stock suffering after the cancellation of the company’s orders with Marvell in April.

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