Citi pointed out that after the substantial rally in Chinese optical module stocks at the start of the year, it was inevitable that some investors would cash in their profits. Nevertheless, considering the significantly enhanced demand visibility extending through 2027, the valuation of optical module firms could see a re-rating, pushing price-to-earnings multiples above 20 times. Analysts are of the opinion that investors have overlooked the robust R&D prowess of Chinese manufacturers. These manufacturers' in-depth cooperation with overseas clients lays a solid groundwork for sustaining high average selling prices and a considerable market share. ASICs (Application-Specific Integrated Circuits) have surfaced as a fresh growth impetus, with the momentum of 800G optical modules persisting, indicating a slower pace of upgrade cycles. The industry's supply situation may tighten in the coming year, with only marginal downward adjustments expected in average selling prices. The recent surge in stock prices has been underpinned by upward revisions in earnings per share, with key trends encompassing margin expansion and a clearer outlook on future demand. Citi has hiked the target prices for Zhongji Inlight, YOFC, and Tianfu Communication, with the CIOE China International Optoelectronic Exposition and the upcoming third-quarter results poised to be significant catalysts.