LASR vs. IPGP: Which Fiber Laser Stock is the Better Buy Now?

Core Viewpoint - nLIGHT (LASR) is experiencing strong growth driven by demand in the aerospace and defense sectors, while IPG Photonics (IPGP) is facing challenges due to weak industrial demand, particularly in China [1][9][21]. nLIGHT Overview - nLIGHT specializes in high-power semiconductor and fiber lasers, targeting markets such as aerospace, defense, and industrial cutting [3]. - The company reported record revenues of $40.7 million from the Aerospace and Defense (A&D) sector in Q2 2025, a 49% increase year over year, contributing to 66% of total sales [4]. - Overall revenues for nLIGHT grew 22% year over year to $61.7 million, with a non-GAAP EPS of 6 cents, a significant improvement from a loss of 10 cents in the previous year [4]. - The defense segment saw a remarkable 74.5% year-over-year growth, bolstered by the HELSI-2 program, a $171 million U.S. DoD contract [6]. - nLIGHT's management raised its full-year A&D growth outlook to at least 40%, up from 25% earlier, with projected revenue growth of 18% and 4.7% for 2025 and 2026, respectively [7][9]. IPG Photonics Overview - IPG Photonics is a leading player in the fiber laser industry, with a strong market share in industrial applications [10]. - The company’s CROSSBOW laser system enhances its position in advanced industrial applications, targeting sectors like automotive and aerospace [11]. - However, IPG Photonics reported a 3% decline in Q2 revenues to $250.7 million and a 42% drop in non-GAAP earnings to 30 cents per share, reflecting challenges in demand and competition [14]. - The Zacks Consensus Estimate indicates a revenue decline of 2.2% for 2025, with a modest increase of 6.4% projected for 2026 [14]. Price Performance and Valuation - Year-to-date, nLIGHT shares have surged 173.3%, while IPG Photonics shares have only increased by 9.9% [16]. - nLIGHT is trading at a forward sales multiple of 5.91X, compared to IPG Photonics' 3.38X, with the premium for nLIGHT justified by its lesser exposure to the weak Chinese market [18]. Conclusion - nLIGHT is positioned favorably with accelerating momentum in defense programs and rapid earnings growth, while IPG Photonics is facing near-term revenue pressures [21][22].