BofA raised the firm’s price target on Coherent to $65 from $48 and keeps a Neutral rating on the shares after its Q2 earnings beat. The results were driven by “strong” AI momentum and improving gross margins, and with AI also driving volume improvement, gross margin is on track to return to over 39% exiting the year, the analyst tells investors in a research note. BofA adds however that its neutral stance is reflecting caution on long-term competitive pressures in the optical communications market.
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