| Valuation method | Value, $ | Upside, % |
|---|---|---|
| Artificial intelligence (AI) | 39.97 | -12 |
| Intrinsic value (DCF) | 3.71 | -92 |
| Graham-Dodd Method | n/a | |
| Graham Formula | n/a |
nLIGHT, Inc. (NASDAQ: LASR) is a leading designer and manufacturer of high-performance semiconductor and fiber lasers, serving industrial, microfabrication, and aerospace & defense markets. Headquartered in Camas, Washington, the company operates through two segments: Laser Products, which includes commercial laser solutions, and Advanced Development, focusing on high-energy directed energy systems. nLIGHT's proprietary technology enables precision laser applications in cutting, welding, and additive manufacturing, while its defense-oriented solutions support next-generation directed energy weapons. With a global footprint spanning the U.S., China, South Korea, and Europe, nLIGHT combines vertical integration with R&D innovation to address growing demand for laser-based automation and defense capabilities. As Industry 4.0 adoption accelerates and military investments in laser systems expand, nLIGHT is positioned at the intersection of two high-growth technology verticals.
nLIGHT presents a high-risk, high-reward proposition tied to secular growth in industrial laser adoption and defense spending, offset by consistent operating losses and sector volatility (β=2.02). While revenue reached $198.5M in the last fiscal year, negative EPS (-$1.27) and operating cash flow (-$2.4M) reflect ongoing R&D and scaling challenges. The $658M cash position provides runway, but investors must weigh the company's technological differentiation against gross margin pressures in the competitive laser market. Key catalysts include defense contract wins and industrial automation demand in Asia, while risks include customer concentration and trade policy impacts on China sales (31% of revenue). Suitable for growth-oriented investors comfortable with speculative tech-industrial plays.
nLIGHT competes through vertical integration—controlling laser diode production, fiber optics, and system design—unlike many competitors reliant on component sourcing. This allows customization for high-power industrial applications (e.g., EV battery welding) and defense systems where competitors like IPG Photonics focus more on standardized products. However, scale disadvantages persist against IPG's $1.4B revenue base. In directed energy, nLIGHT's beam combination technology differentiates it from pure-play industrial laser firms, but competes with defense primes like Lockheed Martin in system integration. The company's China exposure provides cost advantages but introduces geopolitical risks absent in U.S.-centric peers. Gross margins (~25%) trail sector leaders due to product mix and lower utilization, though proprietary CHIP technology could improve efficiency. Customer diversification remains weak compared to peers, with top 10 clients comprising 54% of sales. Success hinges on converting its technology lead in high-power fiber lasers (particularly >10kW systems) into defensible market share before larger players replicate capabilities.