Will Coherent Corp. (COHR) Benefit from Transition?

Carillon Tower Advisers, an investment management company, released its fourth-quarter 2025 investor letter for the “Carillon Eagle Small Cap Growth Fund”. You can download a copy of the letter here. Small-cap stocks delivered marginal gains in the fourth quarter of 2025. The Russell 2000® Value Index outperformed the Russell 2000® Growth Index in the quarter, with more balanced results. In line with the broader stock market, small-cap stocks delivered solid results in 2025. The Russell 2000 Growth Index returned 13.01%, outperforming the Russell 2000 Value Index’s 12.58% gain. The firm anticipates a favorable year ahead for equity markets. The letter outlined the potential opportunities within Cyclicals, Healthcare, Information Technology, Financials, and Consumer spending sectors heading to 2026. Please review the Fund’s top five holdings to gain insights into their key selections for 2025.

In its fourth-quarter 2025 investor letter, Carillon Eagle Small Cap Growth Fund highlighted stocks like Coherent Corp (NYSE:COHR). Coherent Corp. (NYSE:COHR) manufactures and markets engineered materials, optoelectronic components and devices, and laser systems. On February 17, 2026, Coherent Corp. (NYSE:COHR) stock closed at $219.96 per share. One-month return of Coherent Corp. (NYSE:COHR) was 9.18%, and its shares are up 154.64% over the past twelve months. Coherent Corp. (NYSE:COHR) has a market capitalization of $41.23 billion.

Carillon Eagle Small Cap Growth Fund stated the following regarding Coherent Corp. (NYSE:COHR) in its fourth quarter 2025 investor letter:

"Coherent Corp. (NYSE:COHR), a manufacturer of optical communications equipment, saw shares rise on strong earnings results and a positive outlook, driven by orders for transceivers used in artificial intelligence (AI) data centers and for telecommunications interconnections. The company is expected to continue to benefit from a transition to products that enable faster throughput speeds, while prior constraints on manufacturing capacity appear to be alleviating."

Coherent Corp. (NYSE:COHR) is not on our list of 30 Most Popular Stocks Among Hedge Funds. According to our database, 78 hedge fund portfolios held Coherent Corp. (NYSE:COHR) at the end of the third quarter, up from 66 in the previous quarter. While we acknowledge the potential of Coherent Corp. (NYSE:COHR) as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

In another article, we covered Coherent Corp. (NYSE:COHR) and shared Fidelity Growth Strategies Fund's views on the company. In addition, please check out our hedge fund investor letters Q4 2025 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.