Nobody likes coincidence in fiction. This is because coincidence rarely—if ever—works in fiction.
Yes, coincidence does occur in real life. We can accept it (though it is sometimes tragic) in real life. We cannot accept it in fiction even if you are trying to show that coincidence happens in real life. Just don’t do it. NOTE: I can only think of one example when coincidence “worked” in a story: the 1999 Paul Thomas Anderson film, Magnolia. You can watch part of the opening scene here (http://www.youtube.com/watch?v=Ah-_35R1ZqY ) to see what I mean.
If you have coincidence in your MS, change it. This is probably easier than it sounds. You just have to find a way for whatever it was to NOT be a coincidence. Seed the idea or event earlier so that when it happens, we will say, “Yup, I saw that coming,” or, “That figures.” Those reactions are much better than our saying, “Well that came out of nowhere and is just stupid.”
Of course, if you seed the idea well enough, we will NOT see it coming, but when it happens, we will accept it or even say, “Oh! I should have seen that coming!”—and that is always what you want. This is tied to foreshadowing: if you seed the “coincidence” event somehow, it won’t seem like coincidence because you tipped us off to it earlier.