IPGP – Market expectations are for Uniform ROA to recover, but management may have concerns about EVs, laser technology, and innovation

• IPG Photonics Corporation (IPGP:USA) currently trades above historical averages relative to UAFRS-based (Uniform) earnings, with a 24.6x Uniform P/E. At these levels, the market is pricing in bullish expectations, but management may have concerns about electric vehicle (EV) growth opportunities, laser technology capabilities, and their innovation investments.
  
  
• Specifically, management may lack confidence in their ability to continue focusing on innovation and sustain increased sales volumes, particularly from European customers. In addition, they may have concerns about supply chain constraints, the reliability of their lasers, and the durability of secular environmental trends. Furthermore, management may be overstating the strength of the competitive position and capabilities of their products, as well as the opportunities in the electric vehicle market. Finally, they may also lack confidence in their ability to sustain increased adjusted motor beam (AMB) laser sales,  and they may be exaggerating their utility in electric vehicle battery welding applications.