StoneX Initiates Buy Ratings for Lumentum and Coherent
Financial firm StoneX projects significant growth for optical technology leaders Lumentum and Coherent.
Updated on Oct. 26, 2026 in Stock Picks
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StoneX has issued Buy ratings for Lumentum Holdings Inc. and Coherent Corp., citing robust demand for optical technology in AI data centers. The firm set share price targets of $1,200 for Lumentum and $425 for Coherent.
Why it matters
The ratings reflect growing institutional confidence in the hardware supporting AI infrastructure. Both companies are capitalizing on specific customer demand for advanced laser modules and optics solutions.
Lumentum reported $1.01 billion in revenue for the fiscal fourth quarter ending June 27. Coherent maintains more than 10 customer engagements for co-packaged optics and an equal number for near-packaged optics.
The players
StoneX
StoneX is a global financial services firm that provides execution, risk management, and advisory services to institutional and commercial clients.
Lumentum Holdings Inc.
Lumentum is a designer and manufacturer of innovative optical and photonic products that enable optical networking and laser applications.
Coherent Corp.
Coherent is a major provider of materials, networking, and laser technologies for the industrial, communications, electronics, and instrumentation markets.
The details
Lumentum is seeing strong demand for high-power lasers used in co-packaged optics and has secured an initial order for external laser source modules. Meanwhile, Coherent is building momentum for its PhotonLink platform, which is projected to see revenue growth by late 2026.
Timeline
June 27, 2026 marked the conclusion of the Lumentum fiscal fourth quarter.
StoneX initiated coverage for both companies on October 26, 2026.
Coherent anticipates revenue from its PhotonLink platform to ramp up in the fourth quarter of 2026.
Market Dynamics
The transition toward high-speed AI data centers is fueling an arms race in optical connectivity technology. This shift positions companies like Lumentum and Coherent as critical gatekeepers for infrastructure providers needing advanced laser modules.
These ratings provide retail and institutional investors with specific price targets to monitor when evaluating holdings in the optical components sector. Traders should note the long-term timeline for PhotonLink revenue integration when planning portfolio allocations.
The takeaway
Investors should monitor customer engagement milestones as key indicators of market adoption for co-packaged optics technology. Diversification remains essential when betting on the volatile hardware manufacturing sector despite bullish analyst outlooks.
What happens next
Coherent expects revenue from its PhotonLink platform to begin ramping in the fourth quarter of calendar 2026.
Further reading
For broader trends in financial analysis and equity research, see the Stock Picks section.
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