IPG Photonics (Nasdaq: IPGP) caught everybody by surprise three months ago. And by "everybody," I really mean everybody -- fourth-quarter sales and earnings shaped up so much better than even the company's own management expected that it had to preannounce results with earnings guidance boosted by a whopping 68%.
Since that day, the hits have simply kept coming, making fellow Fool Eric Jhonsa look really smart for picking the laser-components builder as the best tech stock for 2011. The stock has more than doubled year-to-date, even after a slight dip on this morning's first-quarter earnings news.
Yup, the bottle rocket lost about 3% of altitude in morning trading. You see, the report was merely great and not mindblowingly awesome.
Earnings of $0.47 per share beat the analyst consensus by a mere $0.04 per share, 95% year-over-year sales growth outdistanced the Street by just 5%, and second-quarter guidance was just a little bit higher than the current consensus.
As you can see, a whole lot of good vibrations had already been priced into the stock. Sales were strong across all geographies and product categories -- with particular strength in China and Europe, and a focus on marking, welding, and cutting applications.
Rivals Newport (Nasdaq: NEWP) and Coherent (Nasdaq: COHR) are riding high on a resurgent semiconductor industry, but IPG's exposure to that particular market is limited. The company's fiber lasers offer advantages over traditional CO2-based lasers. Markets like China and Japan are embracing the new technology quickly, and others follow suit.
Sector giant Rofin-Sinar (Nasdaq: RSTI) is threatened by this newfangled fiber-laser surge and fights back by developing its own fiber lasers and buying smaller players in the field. Meanwhile, IPG simply enjoys the high demand, laughing all the way to the bank.
Is IPG's rocket ride running out of fuel, or will the second quarter astonish investors again? Add IPG Photonics to your watchlist and you'll be the first to know. And then you can discuss the company's future in the comments below.
