Coherent Corp.

AI-generated fair value estimate for this company.

Method: 10-year two-stage DCF on normalized unlevered FCF: $570M normalized base FCF (~8% FCF margin on $7.12B TTM revenue, since reported TTM FCF is deeply negative due to a ~$1.1B one-time capacity-expansion capex surge); FCF growth 20% in years 1-5, 10% in years 6-10; 11% discount rate reflecting high cyclicality and hyperscaler customer concentration; 3% terminal growth; net debt $1.57B; 195.83M diluted shares.

Reasoning: Coherent's reported FCF is temporarily negative while it builds AI-datacenter optics capacity, so a normalized FCF base better reflects steady-state earning power than trailing figures; the elevated discount rate reflects the stock's high beta (~2.1) and heavy dependence on a few hyperscaler customers, and the resulting value is well below the current AI-driven market price, which appears to price in sustained hyper-growth at far higher margins.