Laser Focus World is an industry bedrock—first published in 1965 and still going strong. We publish original articles about cutting-edge advances in lasers, optics, photonics, sensors, and quantum technologies, as well as test and measurement, and the shift currently underway to usher in the photonic integrated circuits, optical interconnects, and copackaged electronics and photonics to deliver the speed and efficiency essential for data centers of the future.

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Editorial Advisory Board

  • Professor Andrea M. Armani, University of Southern California
  • Ruti Ben-Shlomi, Ph.D., LightSolver
  • James Butler, Ph.D., Hamamatsu
  • Natalie Fardian-Melamed, Ph.D., Columbia University
  • Justin Sigley, Ph.D., AmeriCOM
  • Professor Birgit Stiller, Max Planck Institute for the Science of Light, and Leibniz University of Hannover
  • Professor Stephen Sweeney, University of Glasgow
  • Mohan Wang, Ph.D., University of Oxford
  • Professor Xuchen Wang, Harbin Engineering University
  • Professor Stefan Witte, Delft University of Technology

3 Mid-Cap Stocks in Hot Water

TER Cover Image

Mid-cap stocks often strike the right balance between having proven business models and market opportunities that can support $100 billion corporations. However, they face intense competition from scaled industry giants and can be disrupted by new innovative players vying for a slice of the pie.

These dynamics can rattle even the most seasoned professionals, which is why we started StockStory - to help you separate the good companies from the bad. That said, here are three mid-cap stocks to swipe left on and some alternatives you should look into instead.

Teradyne (TER)

Market Cap: $13.27 billion

Sporting most major chip manufacturers as its customers, Teradyne (NASDAQ: TER) is a US-based supplier of automated test equipment for semiconductors as well as other technologies and devices.

Why Are We Cautious About TER?

  1. 3% annual revenue growth over the last five years was slower than its semiconductor peers
  2. Demand will likely be soft over the next 12 months as Wall Street’s estimates imply tepid growth of 2.3%
  3. Day-to-day expenses have swelled relative to revenue over the last five years as its operating margin fell by 7.9 percentage points

Teradyne’s stock price of $81 implies a valuation ratio of 22.9x forward P/E. To fully understand why you should be careful with TER, check out our full research report (it’s free).

Textron (TXT)

Market Cap: $13.84 billion

Listed on the NYSE in 1947, Textron (NYSE: TXT) provides products and services in the aerospace, defense, industrial, and finance sectors.

Why Does TXT Give Us Pause?

  1. Absence of organic revenue growth over the past two years suggests it may have to lean into acquisitions to drive its expansion
  2. Anticipated sales growth of 6.8% for the next year implies demand will be shaky
  3. Free cash flow margin dropped by 5.1 percentage points over the last five years, implying the company became more capital intensive as competition picked up

At $76.48 per share, Textron trades at 12.2x forward P/E. Check out our free in-depth research report to learn more about why TXT doesn’t pass our bar.

Packaging Corporation of America (PKG)

Market Cap: $17.35 billion

Founded in 1959, Packaging Corporation of America (NYSE: PKG) produces containerboard and corrugated packaging products as well as displays and package protection.

Why Is PKG Risky?

  1. 1.4% annual revenue growth over the last two years was slower than its industrials peers
  2. High input costs result in an inferior gross margin of 22.7% that must be offset through higher volumes
  3. Earnings per share have contracted by 4.2% annually over the last two years, a headwind for returns as stock prices often echo long-term EPS performance

Packaging Corporation of America is trading at $194.22 per share, or 11.9x forward EV-to-EBITDA. Dive into our free research report to see why there are better opportunities than PKG.

Stocks We Like More

Market indices reached historic highs following Donald Trump’s presidential victory in November 2024, but the outlook for 2025 is clouded by new trade policies that could impact business confidence and growth.

While this has caused many investors to adopt a "fearful" wait-and-see approach, we’re leaning into our best ideas that can grow regardless of the political or macroeconomic climate. Take advantage of Mr. Market by checking out our Top 5 Strong Momentum Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 176% over the last five years.

Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-micro-cap company Tecnoglass (+1,754% five-year return). Find your next big winner with StockStory today for free.

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