Is nLIGHT (LASR) Still Undervalued After Its Powerful One-Year Share Price Surge?

nLIGHT (LASR) has quietly turned into one of the market’s stronger comeback stories, with the stock up about 26% over the past 3 months and more than tripling year to date.

See our latest analysis for nLIGHT.

That recent 15.7% one month share price return has simply extended a powerful year to date move, with the one year total shareholder return above 230%. This suggests momentum investors are increasingly willing to pay up for nLIGHT’s growth story.

If nLIGHT’s run has you wondering what else might be setting up for a breakout, this could be a good moment to explore high growth tech and AI stocks for other potential opportunities.

Yet with the shares trading below analyst targets but already up severalfold, investors now face a key question: Is nLIGHT still undervalued, or is the market already pricing in all of its future growth?

Most Popular Narrative: 12.2% Undervalued

With nLIGHT closing at $36.44 against a narrative fair value of $41.50, the current market price sits below the valuation implied by its projected trajectory.

The rapid growth and expanding pipeline in aerospace and defense, particularly around high-power laser solutions (e.g., HELSI-2 program, DE M-SHORAD, Golden Dome initiative, and increased directed energy orders internationally), positions nLIGHT to benefit from rising global defense spending and modernization, supporting strong multi-year revenue growth.

Read the complete narrative.

Want to see what kind of revenue ramp, margin lift, and rich future earnings multiple are baked into that fair value? The narrative spells out an aggressive growth path, a profitability transformation, and a valuation profile more typical of market darlings than loss making hardware names. Curious how those moving pieces combine to justify a premium price tag?

Result: Fair Value of $41.50 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, that upbeat scenario could unravel if defense program funding slips or execution stumbles as amplifier products scale from R&D to mass production.

Find out about the key risks to this nLIGHT narrative.

Another View: Multiples Flash a Caution Signal

While the narrative fair value points to 12.2% upside, the simple price to sales lens tells a very different story. nLIGHT trades around 8.1 times sales, far richer than the US Electronic industry at 2.5 times and peers at 3.5 times, and well above a fair ratio of 1.4 times that the market could eventually gravitate toward.

If sentiment cools or growth underwhelms, that gap leaves little margin for error and plenty of room for the valuation to compress. Are investors leaning into a durable growth story, or chasing a momentum trade that could reverse quickly?

See what the numbers say about this price — find out in our valuation breakdown.

Build Your Own nLIGHT Narrative

If you want to dig into the numbers yourself or challenge these assumptions, you can build a custom narrative in just a few minutes: 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.

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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.

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