Despite A Drop In Sales, Coherent Stock Has Managed To Strongly Outperform The S&P 500

COHR: Coherent logo
COHR
Coherent

Coherent Inc. (NASDAQ: COHR) stock price jumped more than 2.5x from $106 in 2018 end, to around $266 currently, primarily due to favorable changes in its P/S multiple. The company, a manufacturer of laser components and equipment, actually witnessed a drop in revenue per share over this period, due to a drop in sales and a rise in the outstanding share count. Despite this, the stock managed to strongly outperform the S&P, which has risen a little over 50%, in comparison, over this period.

In our interactive dashboard, Why Coherent Stock Moved: COHR Stock Has Gained 152% Since 2018, we break down the factors behind this move.

(A) Coherent’s Total Revenue dropped 19% from $1.9 billion in FY 2018 to $1.5 billion currently

  • Coherent’s total revenue initially dropped from $1.9 billion in FY ’18 to $1.2 billion in FY ’20 (COHR’s fiscal year ends in September) but has since recovered and currently stands slightly higher at around $1.5 billion.
  • As of FY ’21, more than 60% of Coherent’s sales come from OEM laser sources sales, with $914 million worth of products sold in FY ’21.
  • The Industrial lasers and systems segment brings in the remaining 40% of revenues, standing at around $574 million as of FY ’21.
  • For details about Coherent revenues and comparison to peers, see Coherent (COHR) Revenue Comparison
Relevant Articles
  1. What’s Behind Microchip Technology Stock’s 3x Rally Since Late 2017?
  2. Colgate-Palmolive Stock Has Returned Just 6% Since Late 2017- Here’s Why
  3. Will News Corp Stock See Higher Levels Following Q4 Results?
  4. Amazon Stock Topped The Revenues Consensus In Q2, What’s Next?
  5. What’s Next For Bristol Myers Squibb Stock?
  6. Helen Of Troy Stock Has Lost 27% Since Late 2019- Here’s Why

(B) Revenue per share (RPS) decreased 20% from $77.45 in FY ’18 to $62.28 currently

  • COHR revenue dropped from $1.9 billion in FY ’18 to $1.5 billion currently, while the outstanding share count increased marginally from 24.6 million in FY ’18 to 24.8 million currently.
  • Due to this, RPS has dropped from $77.45 in FY ’18 to $62.28 currently.

(C) Price-To-Sales (P/S) multiple for Coherent jumped from 1.4x in 2018-end to 4.5x by 2021 end, but has pulled back to 4.3x currently, still around 3x higher than its 2018 level

  • Due to COHR’s stellar performance since 2018-end, its P/S multiple rose strongly from 1.4x in 2018-end to as high as 4.5x by late 2021.
  • However, due to the increased economic uncertainty weighing on the broader markets, the P/S multiple has pulled back, currently standing at around 4.3x, still 3x higher than its 2018 level.
  • For additional details about the company stock returns and comparison to peers, see Coherent (COHR) Stock Return Comparison.

What if you’re looking for a more balanced portfolio instead? Our high-quality portfolio and multi-strategy portfolio have beaten the market consistently since the end of 2016.

Returns Jul 2022
MTD [1]
2022
YTD [1]
2017-22
Total [2]
 COHR Return 0% 0% 94%
 S&P 500 Return 1% -20% 70%
 Trefis Multi-Strategy Portfolio 2% -25% 199%

[1] Month-to-date and year-to-date as of 7/1/2022
[2] Cumulative total returns since the end of 2016

 

Invest with Trefis Market Beating Portfolios
See all Trefis Price Estimates