IPG Photonics (IPGP) AI Stock Analysis

• Market Cap: $3.55B
• Dividend Yield: N/A
• Average Volume (3M): 224.67K
• Price to Earnings (P/E): ―
• Beta (1Y): 1.49
• Revenue Growth: -14.77%
• EPS Growth: -261.91%
• Country: US
• Employees: 4,740
• Sector: Technology
• Sector Strength: 88
• Industry: Semiconductors
• EPS (TTM): 0.16
• Shares Outstanding: 42,219,917
• 10 Day Avg. Volume: 179,240
• 30 Day Avg. Volume: 224,666
• PEG Ratio: 0.09
• Price to Book (P/B): 1.59
• Price to Sales (P/S): 3.30
• P/FCF Ratio: 21.58
• Enterprise Value/Market Cap: 0.57
• Enterprise Value/Revenue: 2.16
• Enterprise Value/Gross Profit: 6.22
• Enterprise Value/Ebitda: 34.30
• 1Y Price Target: $85.80
• Price Target Upside: 2.01% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 7

• Rating: 57 Neutral
• Price Target: $91.00 ▲(8.19% Upside)

IPG Photonics' overall stock score is driven by its financial challenges, including declining revenue and profitability. However, the company shows positive momentum in technical analysis and strategic advancements highlighted in the earnings call. Despite these strengths, the negative P/E ratio and lack of dividend yield weigh down the valuation score.

Positive Factors

Strategic Advancements

The CROSSBOW launch with Lockheed Martin highlights IPG's innovation and strengthens its position in defense applications, potentially opening new revenue streams and enhancing its competitive edge in advanced laser solutions.

Revenue Growth in Advanced Applications

Record revenue in advanced applications indicates strong demand in high-tech sectors, suggesting IPG's strategic focus on these areas is paying off and could drive sustainable growth.

Micromachining and Medical Growth

Growth in micromachining and medical sectors reflects IPG's ability to diversify and capture opportunities in niche markets, which can provide resilience against broader industrial downturns.

Negative Factors

Declining Revenue in Core Markets

Declining revenue in core materials processing markets suggests challenges in maintaining market share and could impact overall financial performance if not addressed.

Uncertain Demand Environment

Uncertainty in demand due to tariffs and macroeconomic factors poses risks to revenue stability and growth, potentially affecting long-term strategic planning.

Increased Operating Expenses

Rising operating expenses can strain profitability, requiring careful management to ensure investments translate into sufficient revenue growth and operational efficiency.

IPG Photonics Business Overview & Revenue Model

Company Description

IPG Photonics Corporation develops, manufactures, and sells various high-performance fiber lasers, fiber amplifiers, and diode lasers used in various applications primarily in materials processing worldwide. The company's laser products include hybrid fiber-solid state lasers with green and ultraviolet wavelengths; fiber pigtailed packaged diodes and fiber coupled direct diode laser systems; high-energy pulsed lasers, multi-wavelength and tunable lasers, and single-polarization and single-frequency lasers; and high-power optical fiber delivery cables, fiber couplers, beam switches, chillers, scanners, and other accessories. It also provides erbium-doped fiber and Raman amplifiers, and integrated communications systems, which are deployed in broadband networks; and ytterbium and thulium specialty fiber amplifiers and broadband light sources. In addition, the company offers integrated laser systems; 2D compact flat sheet cutter systems and multi-axis systems; welding seam stepper and picker, a fiber laser welding tool; high precision laser systems; specialized fiber laser systems; and optical transceiver and transponder modules for interconnecting electronic equipment, including Ethernet switches, IP routers and DWDM/SONET/SDH optical transport modules within telecommunications, cable multi-system operators, and data center networking applications. It's lasers and amplifiers are also used in materials processing, communications, and medical and advanced applications. The company markets its products to original equipment manufacturers, system integrators, and end users through direct sales force, as well as through agreements with independent sales representatives and distributors. IPG Photonics Corporation was founded in 1990 and is headquartered in Oxford, Massachusetts.

How the Company Makes Money

IPG Photonics generates revenue primarily through the sale of its fiber lasers and related products. The company operates on a direct sales model, targeting industrial customers who require high-precision laser solutions for cutting, welding, marking, and engraving applications. Key revenue streams include the sale of laser systems, replacement parts, and service contracts. Additionally, IPG benefits from long-term partnerships with manufacturers and distributors in various industries, which helps to expand its market reach and drive sales. The company also invests in research and development to innovate and enhance its product offerings, ensuring a competitive edge in the rapidly evolving laser technology market.

IPG Photonics Financial Statement Overview

Summary

IPG Photonics faces significant challenges in revenue and profitability, with a TTM revenue growth rate of -72.7% and negative net profit margins. The balance sheet shows low leverage and a strong equity base, but the negative return on equity highlights profitability concerns. Cash flow generation has weakened, indicating operational difficulties.

Income Statement

IPG Photonics has experienced a significant decline in revenue with a TTM revenue growth rate of -72.7%. The gross profit margin has decreased from 42.1% in 2023 to 34.7% in the TTM period. Additionally, the company is facing negative net profit margins, indicating losses. The EBIT margin has turned negative, indicating operational challenges. Overall, the income statement reflects declining performance and profitability issues.

Balance Sheet

The company maintains a low debt-to-equity ratio of 0.008, indicating low leverage and financial stability. However, the return on equity has turned negative in the TTM period, reflecting profitability challenges. The equity ratio remains strong, suggesting a solid financial foundation despite recent performance issues.

Cash Flow

Operating cash flow has decreased significantly, with a TTM operating cash flow to net income ratio of 0.70, indicating reduced cash generation efficiency. Free cash flow has also declined, with a negative growth rate of -42.0%. The free cash flow to net income ratio remains positive, suggesting some ability to generate cash despite net losses.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	945.99M	977.13M	1.29B	1.43B	1.46B	1.20B
Gross Profit	327.82M	338.15M	541.70M	555.41M	696.40M	539.00M
EBITDA	59.48M	75.92M	301.19M	321.97M	462.91M	326.06M
Net Income	-215.42M	-181.53M	218.88M	109.91M	278.42M	159.57M
Balance Sheet
Total Assets	2.38B	2.29B	2.70B	2.74B	3.17B	2.94B
Cash, Cash Equivalents and Short-Term Investments	899.60M	930.19M	1.18B	1.18B	1.51B	1.39B
Total Debt	16.86M	17.96M	18.26M	38.05M	58.13M	62.19M
Total Liabilities	274.90M	264.79M	283.51M	357.92M	423.32M	341.59M
Stockholders Equity	2.10B	2.02B	2.42B	2.39B	2.75B	2.59B
Cash Flow
Free Cash Flow	64.64M	149.37M	185.50M	102.51M	266.59M	197.64M
Operating Cash Flow	151.07M	247.90M	295.99M	212.65M	389.70M	285.33M
Investing Cash Flow	-361.43M	208.73M	-237.55M	296.95M	-416.28M	-99.57M
Financing Cash Flow	-163.85M	-339.62M	-236.38M	-514.55M	-125.07M	-10.08M

IPG Photonics Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 84.11
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For IPGP, the sentiment is Positive. The current price of 84.11 is below the 20-day moving average (MA) of 85.78, above the 50-day MA of 83.13, and above the 200-day MA of 70.94, indicating a neutral trend. The MACD of 1.08 indicates Positive momentum. The RSI at 48.62 is Neutral, neither overbought nor oversold. The STOCH value of 38.09 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for IPGP.

IPG Photonics Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
NVMI	―	$10.73B	48.05	24.23%	―	43.69%	51.22%
OLED	―	$6.98B	29.12	15.07%	1.19%	6.23%	10.12%
PLAB	―	$1.41B	13.55	9.89%	―	-1.79%	-22.58%
ASX	―	$31.94B	29.41	10.97%	2.37%	4.86%	6.44%
SMTC	―	$5.88B	287.21	11.57%	―	22.22%	―
Sector *	―	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
IPGP	―	$3.55B	―	-9.89%	―	-14.77%	-261.91%

IPG Photonics Corporate Events

IPG Photonics Updates Executive Severance and Compensation Plans

On September 30, 2025, IPG Photonics‘ Board of Directors approved significant updates to their Executive Severance Plan and other executive compensation structures. These changes include revised severance payments and performance-based equity awards for executives, particularly in the event of a Change in Control, and the termination of certain senior vice presidents’ employment agreements to align with the new plan. Additionally, the Senior Executive Annual Incentive Plan was amended to coordinate with the Severance Plan, and the Non-Employee Director Compensation Plan was updated to increase the annual cash retainer for the Non-Executive Chair.

The most recent analyst rating on (IPGP) stock is a Buy with a $97.00 price target. To see the full list of analyst forecasts on IPG Photonics stock, see the IPGP Stock Forecast page.

IPG Photonics Reports Strong Q2 2025 Performance

IPG Photonics Corporation is a leading provider of high-power fiber lasers and amplifiers, primarily serving the materials processing industry with innovative laser solutions that enhance productivity and reduce costs.

IPG Photonics’ Earnings Call: Growth Amid Challenges

IPG Photonics’ recent earnings call painted a mixed picture for investors. On the positive side, the company reported a notable revenue growth trend and highlighted successful strategic investments in advanced applications and the medical sector. However, challenges persist, particularly with revenue declines in key segments such as materials processing and the European market. Additionally, the impact of tariffs and increased operating expenses remain areas of concern.