In contrast to Rofin-Sinar (NASDAQ:RSTI), IPG Photonics (NASDAQ:IPGP)
continues to perform very well on the back of growing adoption of fiber
lasers and strong operating efficiency. This has been may favorite
laser name for a while now, and the 35% move in the stock price since my last piece has been nice to see (and well above the results from Rofin-Sinar, Coherent (NASDAQ:COHR), and Newport (NASDAQ:NEWP)).
Although
Rofin-Sinar has looked a little stronger of late in its fiber laser
efforts, it is still well behind IPG Photonics and that is going to be a
difficult gap to fill. Meanwhile, while Rofin-Sinar tries to get to
where IPG Photonics already is, the latter is moving on with newer
offerings like green lasers, ultrafast lasers, UV lasers, and products
targeted at large applications like spot welding and paint stripping.
The only major downside to the IPG Photonics story that I see today is
the high level of expectations - today's price already seems to
anticipate a 10-year run of greater than 10% revenue growth and FCF
margin expansion into the mid-20%'s. While I think the company can do
that, I'm not sure it can do so much better that there's a lot of upside
at today's price.
Read more here:
At IPG Photonics, Strong Performance Backs Aggressive Expectations
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