On Friday, H.C. Wainwright analysts increased the price target on LightPath Technologies (NASDAQ:LPTH) to $5.00, up from the previous $3.00, while maintaining a Buy rating on the company's shares.
The firm's optimism stems from the company's recent performance and future project prospects, which suggest potential positive developments throughout 2025.
LightPath Technologies, known for its advanced optical solutions, reported first-quarter results for fiscal year 2025 in November that were in line with expectations. However, the forward-looking statements regarding ongoing projects, particularly those related to a U.S. missile program with Lockheed Martin Corporation (NYSE:LMT), were highlighted as extremely positive. Should LightPath secure a role in this program, it could lead to an excess of $50.0M in annual revenue, significantly altering the company's financial trajectory.
In addition to the potential Lockheed Martin deal, in December, LightPath announced the commencement of sustained deliveries of infrared assemblies to a European defense customer. This new venture is expected to contribute between $1.0M and $2.0M to the company's annual revenue starting in fiscal year 2025.
With these initiatives expected to contribute to revenue, the firm anticipates that LightPath's revenue growth will pick up speed as fiscal year 2025 comes to a close and continue into fiscal year 2026. Given that the company's operating expenses are largely fixed, the analyst predicts that LightPath will begin to exhibit significant operating leverage. This shift is expected to set the company on a course toward profitability.
Encouraging investors to build a position in LightPath Technologies, the firm supports the Buy rating and justifies the revised price target by referencing the anticipated acceleration in revenue growth and preliminary fiscal year 2026 estimates.
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