{"id":2842,"date":"2026-05-13T16:42:29","date_gmt":"2026-05-13T16:42:29","guid":{"rendered":"https:\/\/retrotradingreport.com\/index.php\/2026\/05\/13\/coherent-lumentum-stocks-continues-surge-how-high-can-the-ai-trade-go\/"},"modified":"2026-05-13T16:42:29","modified_gmt":"2026-05-13T16:42:29","slug":"coherent-lumentum-stocks-continues-surge-how-high-can-the-ai-trade-go","status":"publish","type":"post","link":"https:\/\/retrotradingreport.com\/index.php\/2026\/05\/13\/coherent-lumentum-stocks-continues-surge-how-high-can-the-ai-trade-go\/","title":{"rendered":"Coherent Lumentum stocks continues surge: how high can the AI trade go"},"content":{"rendered":"
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Optical networking stocks extended their strong 2026 rally on Wednesday, with shares of Coherent and Lumentum Holdings climbing alongside broader enthusiasm around artificial intelligence infrastructure demand.<\/p>\n

Coherent shares (COHR) rose 7.2%, while Lumentum gained 3.68%.<\/p>\n

Applied Optoelectronics surged 10.39%, and Corning added 2.42% as investors continued piling into companies tied to AI data-center buildouts.<\/p>\n

All four companies have gained at least 100% so far this year, highlighting investor appetite for businesses supplying optical and networking hardware critical to AI computing infrastructure. <\/p>\n

Applied Optoelectronics has led the group with a 440% rally in 2026.<\/p>\n

AI infrastructure demand lifts optical networking stocks<\/h2>\n

The sector\u2019s latest gains did not appear to stem from a single catalyst. <\/p>\n

Instead, investors continued to react positively to signs of strengthening demand across the AI data-center ecosystem.<\/p>\n

Companies such as Coherent and Lumentum supply optical transceivers and photonic components used to move massive amounts of data between AI servers. <\/p>\n

As hyperscale data-center operators expand infrastructure to support generative AI workloads, investors have increasingly focused on suppliers enabling faster data transmission.<\/p>\n

Broader semiconductor and optical networking stocks also advanced on Wednesday after concerns emerged around tightening global memory chip supply. <\/p>\n

Market sentiment improved further as Nvidia Chief Executive Jensen Huang joined President Donald Trump on his trip to China.<\/p>\n

Supply concerns intensified after labor negotiations at Samsung Electronics reportedly collapsed, raising the possibility of additional disruption in the memory chip market.<\/p>\n

Trump China visit adds to Coherent momentum<\/h2>\n

Investor sentiment toward Coherent also received a boost after CEO Jim Anderson joined Trump\u2019s China delegation.<\/p>\n

Trump said in a social media post that he would ask China\u2019s Xi Jinping to \u201c\u2018open up\u2019 China so that these brilliant people can work their magic.\u201d<\/p>\n

Separately, Needham highlighted positive commentary from Coherent Chief Marketing Officer Sanjai Parthasarathi following an investor dinner on Tuesday. <\/p>\n

According to the research note, the company shipped its first transceiver from its 6-inch fabrication facility, a move expected to improve gross margins compared with earlier-generation products.<\/p>\n

The development reinforced optimism that Coherent could strengthen its position in the fast-growing high-speed transceiver market.<\/p>\n

BofA raises Coherent price target<\/h2>\n

BofA Securities raised its price target on the stock to $400 from $365 while maintaining a Neutral rating.<\/p>\n

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Given 20-30% share in the global transceiver market, we think COHR is best positioned to benefit from higher volumes in 800G\/1.6T transceivers, as we contemplate in our new optical model. We raise our PO to $400 from $365, now on 41x CY27 PE on higher estimates vs. 40x prior, higher due to the stronger potential for earnings leverage and share gains as the market increasingly shifts to higher-speed transceivers. <\/p>\n