2 AI Infrastructure Stocks TD Cowen Thinks Investors Should Own

Core Insights - Coherent is a global leader in photonics and laser technology, essential for data center communications and various industries, including AI [2][9] - The company reported a revenue of $1.69 billion for fiscal 2Q26, marking a 17% year-over-year increase and exceeding forecasts by $50 million [8] - Analyst Sean O'Loughlin views Coherent as well-positioned to benefit from ongoing AI infrastructure spending, particularly in scalable optics [9] Group 1: Company Overview - Coherent offers a diverse product line, including laser and optical subsystems, optical transceivers, and advanced fiber optic lines, crucial for networking and industrial applications [1] - The company's products are integral to the functioning of modern AI systems, enabling efficient data movement between processors and storage [5][6] Group 2: Financial Performance - In fiscal 2Q26, Coherent's non-GAAP earnings per share reached $1.29, a 35% increase from the previous year, surpassing estimates by 8 cents [8] - The stock has a Moderate Buy consensus rating, with a price target of $330, indicating a potential upside of 33% over the next year [9] Group 3: Market Position and Strategy - Coherent's vertical integration and high-margin industrial business model provide a defensive positioning in the market [9] - The company is expected to capitalize on the growing demand for AI infrastructure, particularly in scalable co-packaged optics, representing a significant growth opportunity [9]