Why nLIGHT’s latest expansion matters

nLIGHT (LASR) is more than doubling its Longmont, Colorado capacity with an extra 50,000 square feet, aiming to support high energy laser production for the U.S. Department of War and other government customers.

This capacity move draws fresh attention to how the company’s defense focused work and vertically integrated laser manufacturing might influence how investors think about its growth profile and risk exposure over time.

The expansion news arrives after a strong run in nLIGHT’s shares, with a 30-day share price return of 14.60% and a 90-day share price return of 38.53%. This has contributed to a very large 1-year total shareholder return and together these figures suggest momentum has been building rather than fading.

If this defense focused story has your attention, it could be a good moment to broaden your watchlist and look at aerospace and defense stocks as potential next ideas to research.

With shares up sharply over the past year and the last close near the current analyst price target, is nLIGHT still trading at an attractive entry point, or is the market already pricing in future growth?

Most Popular Narrative: 7.3% Overvalued

Compared with the most followed fair value estimate of $41.86, nLIGHT’s last close at $44.93 sits above that narrative anchor and raises questions about what is already priced in.

Recent improvements in gross margin, disciplined operating expense management, and better working capital efficiency indicate potential for enhanced earnings and free cash flow as revenue mix shifts further toward defense and advanced manufacturing applications.

Curious what kind of revenue ramp and margin shift could back up that fair value, and how long it might take? The full narrative lays out specific growth, profitability, and valuation multiple assumptions that sit behind the current view on nLIGHT’s long term earnings power and risk profile.

Result: Fair Value of $41.86 (OVERVALUED)

However, the story could look different if defense programs are delayed or if commercial demand stays weak. This would challenge those long term margin and growth assumptions.

Build Your Own nLIGHT Narrative

If you see the story differently or would rather test the assumptions yourself, you can build a personalised view in just a few minutes with Do it your way.

A great starting point for your nLIGHT research is our analysis highlighting 1 key reward and 2 important warning signs that could impact your investment decision.

Looking for more investment ideas?

If nLIGHT is on your radar, do not stop there. Widen your opportunity set now so you are not watching from the sidelines when other themes move.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.