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<h2>Key Points</h2><ul><li>IPG Photonics stock gained 42% in February after its Q4 earnings blew past Wall Street estimates.</li><li>Revenue jumped 17% year over year, and adjusted earnings more than doubled expectations.</li><li>Management expects the medical business to double or triple over the next year.</li><li>10 stocks we like better than IPG Photonics ›</li></ul>Shares of IPG Photonics (NASDAQ: IPGP) rose 42.4% in February 2026, according to data from S&amp;P Global Market Intelligence. It's no mystery why the maker of fiber lasers soared, either. The fourth-quarter report it published on Feb. 12 and blew past analyst estimates by a wide margin.<h2>IPG Photonics crushed Wall Street's expectations</h2>Analyst consensus estimates suggested a fairly weak report. Adjusted earnings were expected to fall from $0.19 to $0.18 per diluted share, while revenue estimates pointed to roughly $247.7 million, or 5.7% year-over-year growth.Will AI create the world's first trillionaire? Our team just released a report on the one little-known company, called an &#34;Indispensable Monopoly&#34; providing the critical technology Nvidia and Intel both need. Continue »Instead, IPG Photonics more than doubled non-GAAP earnings to $0.46 per share on $274.5 million of top-line sales. That's a 17.2% revenue jump.Fiber lasers are a hot item right now, and IPG Photonics' management said that the strong growth should continue at least for the next couple of years.<h2>Fiber lasers are everywhere</h2>Fiber lasers may sound like a high-tech toy, but they are crucial components in many exciting industries.Battery makers use them for welding, which connects IPG Photonics to the electric vehicles and utility-scale energy storage sectors. Industrial manufacturers also employ lasers in high-precision cutting and cleaning. Many medical imaging machines won't work without fiber lasers. And I'm just skimming the largest current revenue generators in IPG Photonics' client portfolio.Looking ahead, the company is researching lasers for quantum computing, nuclear clocks, and ultra-short wavelength beams for semiconductor manufacturing. This technology isn't just an academic exercise in pure laser research, but the pathway to new revenue streams in the long run.&#34;We have talked about core investments in medical and micromachining, areas like directed energy. Those are addressing new TAM for us that is several billion dollars,&#34; CEO Mark Gitin said on the earnings call. &#34;We expect to see growth in that area of hundreds of millions of dollars over the next several years.&#34;<img alt="A hand holding a bundle of lighted fiber-optic fibers." src="https://imageproxy.pbkrs.com/https://g.foolcdn.com/image//query-dXJsPWh0dHBzOi8vZy5mb29sY2RuLmNvbS9lZGl0b3JpYWwvaW1hZ2VzLzg1OTc5OC9oYW5kZnVsLW9mLWZpYmVyLW9wdGljcy5qcGcmdz03MDA?x-oss-process=image/auto-orient,1/interlace,1/resize,w_1440,h_1440/quality,q_95/format,jpg" width="700" height="476" original-src="https://imageproxy.pbkrs.com/https://g.foolcdn.com/image//query-dXJsPWh0dHBzOi8vZy5mb29sY2RuLmNvbS9lZGl0b3JpYWwvaW1hZ2VzLzg1OTc5OC9oYW5kZnVsLW9mLWZpYmVyLW9wdGljcy5qcGcmdz03MDA"/>
Image source: Getty Images.
The medical sector is especially interesting, as IPG Photonics is preparing multiple new products for that market in 2026.&#34;That roadmap continues on for the next couple of years,&#34; Gitin said. &#34;Over the next year, we expect the [medical] business to double or triple.&#34;IPG Photonics isn't a cheap stock, trading at 169 times GAAP earnings or 86 times adjusted today. Many investors are skeptical of the company's growth prospects. 22% of its shares are on loan to short-sellers as of the latest short-sale data collection on Feb. 13, right after the Q4 report. So there are serious reasons to be careful with this unpredictable stock.Still, the company has tended to deliver on management's promises in recent years, resulting in a plethora of Street-stumping earnings reports. If you expect IPG Photonics to deliver more surprises in 2026 and beyond, this stock could be an effective tool for tapping into several tempting growth opportunities at once. Just make sure you can handle extreme speed bumps on the road ahead.<h2>Should you buy stock in IPG Photonics right now?</h2>
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IPGP

IPG Photonics stock surged 42% in February following a strong Q4 earnings report that exceeded Wall Street expectations. Revenue increased by 17% year-over-year, with adjusted earnings more than doubling forecasts. The company anticipates significant growth in its medical business, expecting it to double or triple in the next year. Despite its high valuation, IPG Photonics has consistently met management's growth promises, making it a potential investment opportunity, albeit with caution due to market volatility.

How IPG Photonics Stock Gained 42% Last Month