Movement Alert|Coherent Falls 3.36% in Regular Trading, Optical Communication Capacity Expansion Fears Persist Despite Bernstein Bullish Initiation

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On September 30, Coherent fell 3.36% in regular trading, trading at $282.69/share, with turnover of $392 million. The decline erased the prior session's 3.24% rebound that was fueled by Morgan Stanley's upbeat assessment of industry capacity nearing sold-out status over the next 12 to 18 months.

On the news front, concerns over a looming supply glut in the optical communication sector continued to dominate sentiment. Over the third quarter, more than ten supply-chain companies disclosed capacity expansion plans totaling approximately 400 billion yuan, intensifying market fears of a volume-up, price-down dynamic. Industry data project 800G optical module average selling prices declining from roughly $440 to $314 by 2028, underscoring pricing pressure even as demand remains robust.

Notably, Bernstein initiated coverage of Coherent on the same day with an Outperform rating and a $350 price target, while the analyst consensus target stands at approximately $412.83. However, short-term expansion-related sentiment overrode the bullish call. Peer Corning fell 3.65%, reflecting broad sector weakness. UBS has argued that overcapacity risks are overstated, noting that lead times for key equipment could stretch new capacity buildouts to two to three years, suggesting supply-demand conditions may remain tight through 2027-2028.

(The above content is based on publicly available market information, generated by a program or algorithm, and is intended solely as a stock movement alert. It does not constitute investment advice or a basis for trading decisions.)

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