nLight (NASDAQ:LASR) Trading Down 9.2% - Should You Sell?

Key Points

• nLight shares fell 9.2% during mid-day trading, briefly hitting $58.47 before last trading around $59.29, on volume well below average. The move came after the stock had closed at $65.30 the prior day.
• Despite the drop, recent analyst sentiment remains mostly positive: the stock carries a “Moderate Buy” consensus with a $75.50 average price target. Recent reports included upgrades and price-target hikes from firms such as Needham, Raymond James, and Roth Capital.
• The company’s latest quarterly results were strong, with EPS of $0.20 versus $0.08 expected and revenue of $80.18 million versus $72.14 million expected. Revenue rose 55.2% year over year, although the company still posted negative margins and management/insider selling has been notable recently.

nLight (NASDAQ:LASR - Get Free Report)'s stock price was down 9.2% during mid-day trading on Tuesday . The company traded as low as $58.47 and last traded at $59.2870. 404,225 shares were traded during mid-day trading, a decline of 72% from the average daily volume of 1,469,152 shares. The stock had previously closed at $65.30.

Analyst Upgrades and Downgrades

LASR has been the subject of a number of research analyst reports. William Blair assumed coverage on nLight in a report on Friday, March 27th. They issued an "outperform" rating for the company. Needham & Company LLC increased their price target on nLight from $70.00 to $80.00 and gave the stock a "buy" rating in a report on Friday, May 8th. Weiss Ratings reaffirmed a "sell (d-)" rating on shares of nLight in a research report on Tuesday, April 21st. Raymond James Financial reiterated a "strong-buy" rating and issued a $100.00 price objective on shares of nLight in a research note on Friday, May 8th. Finally, Roth Capital reissued a "buy" rating and set a $81.00 target price on shares of nLight in a research note on Friday, April 24th. One research analyst has rated the stock with a Strong Buy rating, eight have issued a Buy rating, one has given a Hold rating and one has issued a Sell rating to the company's stock. Based on data from MarketBeat.com, the stock presently has a consensus rating of "Moderate Buy" and a consensus target price of $75.50.

nLight Stock Down 10.0%

The company has a market capitalization of $3.32 billion, a P/E ratio of -196.00 and a beta of 2.30. The firm's 50-day moving average price is $70.63 and its 200 day moving average price is $59.90.

nLight (NASDAQ:LASR - Get Free Report) last released its quarterly earnings results on Thursday, May 7th. The company reported $0.20 earnings per share (EPS) for the quarter, beating analysts' consensus estimates of $0.08 by $0.12. The business had revenue of $80.18 million during the quarter, compared to the consensus estimate of $72.14 million. nLight had a negative return on equity of 4.18% and a negative net margin of 5.08%.The company's quarterly revenue was up 55.2% on a year-over-year basis. During the same quarter in the previous year, the business earned ($0.04) EPS. As a group, equities research analysts expect that nLight will post -0.17 EPS for the current year.

Insider Buying and Selling

In related news, CAO James Nias sold 940 shares of the stock in a transaction on Wednesday, June 3rd. The stock was sold at an average price of $77.99, for a total value of $73,310.60. Following the completion of the sale, the chief accounting officer directly owned 97,621 shares of the company's stock, valued at approximately $7,613,461.79. This represents a 0.95% decrease in their position. The transaction was disclosed in a filing with the SEC, which can be accessed through the SEC website. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Also, CEO Scott H. Keeney sold 16,089 shares of nLight stock in a transaction on Thursday, June 4th. The stock was sold at an average price of $74.60, for a total transaction of $1,200,239.40. Following the transaction, the chief executive officer directly owned 2,185,039 shares in the company, valued at $163,003,909.40. This represents a 0.73% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Over the last 90 days, insiders sold 391,038 shares of company stock worth $28,367,419. 3.10% of the stock is owned by corporate insiders.

Institutional Inflows and Outflows

Several hedge funds and other institutional investors have recently added to or reduced their stakes in LASR. SBI Securities Co. Ltd. increased its stake in nLight by 22.3% in the 4th quarter. SBI Securities Co. Ltd. now owns 1,225 shares of the company's stock valued at $46,000 after buying an additional 223 shares during the last quarter. Quantinno Capital Management LP boosted its stake in shares of nLight by 0.7% in the 1st quarter. Quantinno Capital Management LP now owns 41,808 shares of the company's stock worth $2,384,000 after buying an additional 281 shares during the last quarter. ProShare Advisors LLC grew its holdings in shares of nLight by 2.7% in the fourth quarter. ProShare Advisors LLC now owns 13,745 shares of the company's stock valued at $516,000 after acquiring an additional 358 shares in the last quarter. Price T Rowe Associates Inc. MD increased its position in shares of nLight by 1.6% during the fourth quarter. Price T Rowe Associates Inc. MD now owns 26,574 shares of the company's stock valued at $997,000 after acquiring an additional 422 shares during the last quarter. Finally, NewEdge Advisors LLC increased its position in shares of nLight by 8.0% during the fourth quarter. NewEdge Advisors LLC now owns 6,003 shares of the company's stock valued at $225,000 after acquiring an additional 443 shares during the last quarter. 83.88% of the stock is currently owned by hedge funds and other institutional investors.

About nLight

nLIGHT, Inc designs, develops, manufactures, and sells semiconductor and fiber lasers for industrial, microfabrication, and aerospace and defense applications. The company operates in two segments, Laser Products and Advanced Development. It offers semiconductor lasers with various ranges of power levels, wavelengths, and output fiber sizes; and programmable and serviceable fiber lasers for use in industrial and aerospace and defense applications. The company also provides laser sensors, including light detection and ranging technologies for intelligence, surveillance, and reconnaissance applications; and fiber amplifiers, beam combination, and control systems for use in high-energy laser systems in directed energy applications.

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