Lasers are a critical enabling technology across defense, industrial manufacturing, and advanced materials processing. For growth-oriented investors using a disciplined framework like the Mark Minervini SEPA (Specific Entry Point Analysis) strategy, combining a clean technical uptrend with accelerating fundamental momentum is the sweet spot. This approach screens for stocks in a confirmed Stage 2 uptrend (the Trend Template) before layering on rigorous checks for earnings and sales acceleration. The goal is to find companies where institutional demand is building ahead of the crowd. nLIGHT Inc (NASDAQ:LASR) has emerged from this screening process as a candidate that merits closer inspection.

Meeting the Trend Template Criteria

The Minervini Trend Template is non-negotiable; a stock must pass every single rule to even make the watchlist. A review of the technical data shows that nLIGHT currently satisfies these requirements.

• Moving Average Alignment: The stock trades well above its key moving averages. The current price of 72.05 sits comfortably above the 50-day SMA of 70.37, the 150-day SMA of 58.91, and the 200-day SMA of 52.02.
• Ascending Long-Term Moving Averages: The 200-day SMA is rising, currently at 52.02 compared to its previous value of 51.82. The 150-day SMA is also trending upward at 58.91, confirming that the long-term trend is solidly positive.
• Proper Stacking: The 50-day SMA (70.37) is above the 150-day SMA (58.91), which in turn is above the 200-day SMA (52.02). This is the ideal "stacking" alignment that Minervini looks for.
• 52-Week Range Positioning: The stock is currently 30.4% above its 52-week low of 17.84, which is just above the 30% threshold. More importantly, it is trading within 17% of its 52-week high of 86.95, placing it in the "within 25%" zone—a critical filter for momentum.
• Relative Strength: A Relative Strength (RS) ranking of 98.31 means the stock is outperforming 98% of all other stocks in the market. This is exactly where Minervini wants you to look—right at the top of the performance leaderboard.

The rationale is straightforward: a stock with this kind of technical structure has already proven it can attract buyers. By buying near a 52-week high with low volatility, you are aligning with the path of least resistance.

The High Growth Engine: Fundamental Acceleration

Minervini’s strategy does not stop at the chart. The second pillar is explosive fundamental growth, and here, nLIGHT’s numbers are striking. The strategy requires earnings per share (EPS) to be accelerating, not just growing. The data provided confirms this.

• Earnings Explosion:
  • EPS (TTM) is 0.48, representing a 192% increase over the prior year.
  • Quarterly EPS growth is even more dramatic, with the most recent quarter showing a 600% year-over-year increase.
  • The acceleration is evident across the trailing four quarters: +160%, +200%, +146%, and the explosive +600% in the most recent period. This is not a one-off beat; it is a trend.
• Revenue Acceleration: Sales are following the same trajectory.
  • TTM revenue growth is 40.9%.
  • Quarterly sales growth has accelerated from 22% and 18% in the prior quarters to a robust 55.1% in the most recent quarter.
• Estimate Revisions: Wall Street is paying attention. The average EPS estimate for the next year has been revised upward by a massive 73.8% over the last three months, and revenue estimates have been revised up by 8%. This confirms the "catalyst" element Minervini seeks.
• Execution Consistency: The company has beaten EPS estimates in each of the last 4 quarters by an average of 161%, demonstrating that it consistently under-promises and over-delivers.

For a high-growth investor, this is a textbook setup. The company is generating strong cash flow (FCF per share of 0.39, up 51% year-over-year) and is expanding margins, evidenced by the recent profit margin reading of 0.8%.

ChartMill Technical Assessment

The proprietary ChartMill Technical Report gives nLIGHT a strong technical rating of 8 out of 10 and a setup rating of 6. The system notes that the stock is one of the best performers in the market, outperforming 98% of all stocks and 96% of its industry peers. The report highlights that while the short and long-term trends are currently neutral, the recent price action is very positive, and the stock is consolidating near the top of its recent range.

• Support: A clear support level is identified at $61.37, based on a horizontal line on the weekly chart.
• Resistance: A resistance level is identified at $74.71 based on a horizontal line on the daily chart. The stock is currently trading just slightly below this resistance.

The report also notes that large players (institutional activity) have shown recent interest, a positive sign for a potential breakout.

Curious what other stocks pass the same rigorous High Growth Momentum + Trend Template screen? Click here to see the full, updated list of results.

For a deeper look at the technical details, you can view the full ChartMill Technical Analysis Report for LASR.

Disclaimer: This article is for informational and educational purposes only and does not constitute investment advice. Trading in financial markets involves substantial risk. Always perform your own analysis and consult with a qualified financial advisor before making any investment decisions.

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