J.P. Morgan reiterated Overweight ratings for optical-networking firms Coherent and Lumentum. Analyst Samik Chatterjee noted that shares have declined more than 15% from their early June highs.
The report dismissed concerns regarding adoption delays for co-packaged optics in AI data centers. Demand from Nvidia and cloud service providers is currently tracking ahead of schedule.
J.P. Morgan maintained a price target of $380 for Coherent. The price target for Lumentum remains $1,130. These valuations are based on strong earnings growth forecasts.