In the rapidly evolving technology sector, Coherent, Inc. (COHR) and MKS Inc. (MKSI) stand out as key players within the hardware, equipment, and parts industry. Both companies are engaged in innovative laser and process control solutions, making them rivals in overlapping markets. Their distinct approaches to technology and customer applications provide a fascinating comparison for investors. In this analysis, I will guide you through the strengths and weaknesses of each company, helping you determine which might be the more compelling investment opportunity.
Table of contents
Company Overview
Coherent, Inc. Overview
Coherent, Inc. is a leader in the laser technology sector, providing a comprehensive range of lasers and laser-based systems for various applications in commercial, industrial, and scientific research. Founded in 1966 and headquartered in Santa Clara, California, Coherent operates under two primary segments: OEM Laser Sources and Industrial Lasers & Systems. The company specializes in designing, manufacturing, and servicing high-performance laser tools and precision optics, aimed at sectors such as microelectronics, materials processing, and scientific research. As of recent reports, Coherent, which became a subsidiary of II-VI Incorporated in 2022, boasts a market capitalization of approximately $25.5B and continues to push the boundaries of innovation in laser technologies.
MKS Inc. Overview
MKS Inc. is a prominent player in the development of instruments and systems that optimize manufacturing processes globally. Established in 1961 and located in Andover, Massachusetts, the company offers a wide array of solutions across its Vacuum & Analysis, Light & Motion, and Equipment & Solutions segments. MKS focuses on delivering critical process control technologies, including vacuum control solutions and laser systems, catering to diverse markets such as semiconductors, industrial technologies, and life sciences. With a market cap of around $10.5B, MKS is committed to enhancing manufacturing efficiency and precision through technological innovation.
Key similarities and differences
Both Coherent and MKS operate in the hardware and equipment sector, focusing on advanced technologies for industrial applications. However, while Coherent emphasizes laser systems specifically, MKS provides a broader spectrum of process control solutions, including vacuum and plasma technologies. Their strategic approaches differ, with Coherent being more laser-centric and MKS encompassing a wider array of manufacturing process solutions.
Income Statement Comparison
The following table compares the latest income statements for Coherent, Inc. (COHR) and MKS Inc. (MKSI), highlighting key financial metrics.
| Metric | Coherent, Inc. (COHR) | MKS Inc. (MKSI) |
|---|---|---|
| Market Cap | 25.53B | 10.50B |
| Revenue | 5.81B | 3.59B |
| EBITDA | 1.11B | 0.87B |
| EBIT | 0.55B | 0.52B |
| Net Income | 49.36M | 190.00M |
| EPS | -0.32 | 2.82 |
| Fiscal Year | 2025 | 2024 |
Interpretation of Income Statement
In the most recent year, Coherent, Inc. reported a revenue increase to 5.81B, reflecting a rebound from previous losses, while MKS Inc. saw a slight decline from 3.62B. Coherent’s net income turned positive at 49.36M, whereas MKS reported a net income of 190M, showcasing its profitability amid challenging market conditions. The EBITDA margins for both companies indicate stability, yet Coherent’s EPS remains negative, suggesting ongoing operational challenges. Overall, Coherent’s recovery trajectory is promising, but MKS maintains a stronger profitability position.
Financial Ratios Comparison
Below is a comparative table showing the most recent revenue and financial ratios for Coherent, Inc. (COHR) and MKS Inc. (MKSI).
| Metric | COHR | MKSI |
|---|---|---|
| ROE | 0.61% | 8.18% |
| ROIC | 1.28% | 6.66% |
| P/E | 280.75 | 36.98 |
| P/B | 1.70 | 3.03 |
| Current Ratio | 2.19 | 3.19 |
| Quick Ratio | 1.39 | 2.04 |
| D/E | 0.48 | 2.06 |
| Debt-to-Assets | 26.11% | 55.65% |
| Interest Coverage | 2.20 | 1.44 |
| Asset Turnover | 0.39 | 0.42 |
| Fixed Asset Turnover | 3.09 | 3.55 |
| Payout ratio | 23.17% | 31.05% |
| Dividend yield | 0.08% | 0.84% |
Interpretation of Financial Ratios
In comparing COHR and MKSI, MKSI shows stronger profitability indicators with higher ROE and ROIC, indicating better returns on equity and invested capital. While COHR has a lower P/E ratio, suggesting it may be undervalued, its high debt-to-equity ratio signals potential financial risk. COHR’s current and quick ratios suggest solid liquidity, but MKSI’s ratios are also robust. Investors should weigh these factors carefully when considering investment options.
Dividend and Shareholder Returns
Coherent, Inc. (COHR) has shown a modest dividend yield of 0.08% with a payout ratio of 23%, indicating some commitment to returning value to shareholders, albeit at low levels. The company also engages in share buybacks, which can enhance shareholder value by reducing share count. Conversely, MKS Inc. (MKSI) has a higher dividend yield of 0.84% and a payout ratio of 31%, coupled with share buybacks, indicating a balanced approach to shareholder returns. Both strategies suggest a focus on sustainable long-term value creation.
Strategic Positioning
Coherent, Inc. (COHR) holds a notable market share in the laser technology sector, particularly in OEM Laser Sources and Industrial Lasers & Systems. MKS Inc. (MKSI) competes closely with a diverse range of process control solutions and laser products. Both companies face competitive pressure from emerging technologies and established players in the hardware and equipment industry. Additionally, advancements in laser applications and manufacturing processes may disrupt existing market dynamics, making careful evaluation essential for investors.
Stock Comparison
In this section, we will analyze the stock price movements of Coherent, Inc. (COHR) and MKS Inc. (MKSI) over the past year, focusing on key price changes and trading dynamics that can influence investment decisions.
Trend Analysis
For Coherent, Inc. (COHR), the overall price change over the past year is +298.98%. This significant increase indicates a bullish trend, characterized by acceleration in price movement. The stock reached a notable high of 164.26 and a low of 41.17, with a standard deviation of 24.58 suggesting some volatility in its price. More recently, from September 14, 2025, to November 30, 2025, the stock has appreciated by 59.49%, maintaining a strong upward slope (5.08) and demonstrating continued acceleration.
In comparison, MKS Inc. (MKSI) also reflects a robust performance with an overall price change of +59.65% over the past year, confirming a bullish trend. The stock’s high was 156.39, with a low of 60.29, and it exhibits a standard deviation of 19.14, indicating moderate volatility. In the recent period from September 14, 2025, to November 30, 2025, MKSI has shown a price increase of 35.87%, with a trend slope of 3.14, also highlighting acceleration in its upward movement.
Both stocks present strong bullish trends, but COHR shows a more pronounced percentage change and acceleration compared to MKSI.
Analyst Opinions
Recent recommendations for Coherent, Inc. (COHR) yield a B- rating, indicating a cautious approach. Analysts highlight concerns over low price-to-earnings ratios, suggesting it may be overvalued. In contrast, MKS Inc. (MKSI) has garnered a B+ rating, with analysts praising its strong return on assets and manageable debt levels. The consensus for COHR is a hold, while MKSI is seen as a buy for the current year, reflecting confidence in its growth prospects.
Stock Grades
I have gathered the latest stock grades for Coherent, Inc. (COHR) and MKS Inc. (MKSI) from reputable grading companies. Here’s the detailed breakdown:
Coherent, Inc. Grades
| Grading Company | Action | New Grade | Date |
|---|---|---|---|
| Barclays | maintain | Overweight | 2025-11-07 |
| Morgan Stanley | maintain | Equal Weight | 2025-11-06 |
| Stifel | maintain | Buy | 2025-11-06 |
| Needham | maintain | Buy | 2025-11-06 |
| Rosenblatt | maintain | Buy | 2025-11-06 |
| Susquehanna | maintain | Positive | 2025-10-22 |
| Barclays | maintain | Overweight | 2025-10-20 |
| Rosenblatt | maintain | Buy | 2025-10-14 |
| Morgan Stanley | maintain | Equal Weight | 2025-10-10 |
| Morgan Stanley | maintain | Equal Weight | 2025-08-14 |
MKS Inc. Grades
| Grading Company | Action | New Grade | Date |
|---|---|---|---|
| Citigroup | maintain | Buy | 2025-11-12 |
| Wells Fargo | maintain | Equal Weight | 2025-11-07 |
| Benchmark | maintain | Buy | 2025-11-07 |
| Keybanc | maintain | Overweight | 2025-11-07 |
| Needham | maintain | Buy | 2025-11-06 |
| Mizuho | maintain | Outperform | 2025-10-16 |
| Needham | maintain | Buy | 2025-10-13 |
| Goldman Sachs | maintain | Sell | 2025-10-09 |
| Wells Fargo | maintain | Equal Weight | 2025-08-08 |
| Needham | maintain | Buy | 2025-08-07 |
Overall, both companies have maintained strong grades, with various analysts endorsing both stocks as either “Buy” or “Overweight.” This indicates a generally positive sentiment in the market toward their future performance.
Target Prices
Current consensus target prices for the following companies indicate optimistic growth potential.
| Company | Target High | Target Low | Consensus |
|---|---|---|---|
| Coherent, Inc. | 190 | 85 | 144 |
| MKS Inc. | 180 | 136 | 163.4 |
For Coherent, Inc. (COHR), the consensus target price of 144 suggests a potential upside from its current price of 164.28. Similarly, MKS Inc. (MKSI) has a consensus of 163.4, slightly above its current trading price of 156.39. Both companies show favorable analyst expectations.
Strengths and Weaknesses
The following table provides an overview of the strengths and weaknesses of Coherent, Inc. (COHR) and MKS Inc. (MKSI) based on the most recent data.
| Criterion | Coherent, Inc. | MKS Inc. |
|---|---|---|
| Diversification | Moderate | High |
| Profitability | Low | Moderate |
| Innovation | High | High |
| Global presence | Moderate | High |
| Market Share | Moderate | High |
| Debt level | Moderate | High |
Key takeaways include Coherent’s strong innovation capabilities but low profitability, while MKS demonstrates high diversification and global presence, albeit with a higher debt level. Investors should weigh these factors carefully when considering either stock for their portfolios.
Risk Analysis
The table below outlines the key risks associated with Coherent, Inc. (COHR) and MKS Inc. (MKSI) based on the most recent fiscal year.
| Metric | Coherent, Inc. | MKS Inc. |
|---|---|---|
| Market Risk | High | Medium |
| Regulatory Risk | Medium | Medium |
| Operational Risk | High | High |
| Environmental Risk | Medium | High |
| Geopolitical Risk | Medium | Medium |
Both companies face significant operational risks, particularly due to their reliance on advanced technologies and global supply chains. Recent geopolitical tensions and regulatory changes could further impact their operations and market positions.
Which one to choose?
When comparing Coherent, Inc. (COHR) and MKS Inc. (MKSI), we find that MKSI shows stronger fundamentals overall. While both companies have a bullish stock trend, MKSI boasts a higher gross profit margin at 47.63% compared to COHR’s 35.17%. MKSI’s B+ rating reflects a robust performance in return on assets (4) and a decent debt-to-equity ratio (3), which suggests prudent financial management. COHR, despite a significant recent price increase of 298.98%, struggles with profitability, showing a negative net income margin.
For investors focused on growth, MKSI may be the preferable choice given its healthier financial metrics and recent upward momentum. Conversely, those prioritizing risk management might lean towards COHR, although it poses higher volatility due to its erratic performance.
Disclaimer: This article is not financial advice. Each investor is responsible for their own investment decisions.
Go further
I encourage you to read the complete analyses of Coherent, Inc. and MKS Inc. to enhance your investment decisions:
