Lumen Technologies (NYSE:LUMN) Stock Price Down 8.8% on Analyst Downgrade

Key Points

• Lumen Technologies shares fell 8.8% to $6.12 after Goldman Sachs cut its price target from $8.50 to $7.25 while maintaining a neutral rating.
• Analysts remain cautious overall: nine rate the stock Hold and one rates it Sell, producing a consensus “Reduce” rating and an $8.11 price target.
• Lumen’s latest results beat expectations, with a narrower-than-expected quarterly loss and $2.81 billion in revenue, but revenue still declined 9.3% year over year and EBITDA remains under pressure as legacy operations wind down.

Lumen Technologies, Inc. (NYSE:LUMN - Get Free Report) was down 8.8% during mid-day trading on Wednesday after The Goldman Sachs Group lowered their price target on the stock from $8.50 to $7.25. The Goldman Sachs Group currently has a neutral rating on the stock. Lumen Technologies traded as low as $6.12 and last traded at $6.12. 4,699,114 shares traded hands during mid-day trading, a decline of 65% from the average daily volume of 13,474,102 shares. The stock had previously closed at $6.71.

Several other equities research analysts have also recently issued reports on LUMN. Zacks Research cut Lumen Technologies from a "strong-buy" rating to a "hold" rating in a report on Tuesday, May 5th. UBS Group increased their target price on Lumen Technologies from $6.00 to $8.00 and gave the company a "neutral" rating in a report on Wednesday, May 6th. JPMorgan Chase & Co. lifted their price target on Lumen Technologies from $6.00 to $7.00 and gave the stock a "neutral" rating in a research note on Monday, May 11th. TD Cowen boosted their price target on Lumen Technologies from $8.00 to $9.00 and gave the stock a "hold" rating in a research report on Wednesday, May 6th. Finally, Weiss Ratings restated a "sell (d-)" rating on shares of Lumen Technologies in a report on Friday, July 17th. Nine equities research analysts have rated the stock with a Hold rating and one has given a Sell rating to the stock. According to MarketBeat.com, Lumen Technologies has an average rating of "Reduce" and a consensus price target of $8.11.

Lumen Technologies News Summary

Here are the key news stories impacting Lumen Technologies this week:

• Positive Sentiment: Lumen’s second-quarter loss was narrower than expected at $0.07 per share versus the $0.13 consensus estimate, while revenue of $2.81 billion exceeded forecasts of $2.74 billion. Lumen Reports Q2 Loss, Tops Revenue Estimates
• Positive Sentiment: Strategic revenue rose approximately 14%, reaching more than half of business revenue, supported by increased NaaS adoption and demand for digital, cloud and AI networking. The Alkira acquisition is also intended to strengthen Lumen’s multi-cloud networking platform. Lumen Beats Revenue Estimates on Strong Digital Networking Demand
• Positive Sentiment: Free cash flow turned positive, and management maintained its full-year outlook, including expected free cash flow of $1.9 billion to $2.1 billion. Lumen Q2: Another Step Forward
• Neutral Sentiment: Lumen appointed John M. Hinshaw, a former technology and operations executive at companies including HSBC, Hewlett-Packard, Boeing and Verizon Wireless, to its board. The move adds digital transformation, security and operational expertise but does not immediately change financial results. Lumen Appoints John M. Hinshaw to Board
• Negative Sentiment: Total revenue still fell 9.3% year over year, and EBITDA remains under pressure as Lumen winds down lower-growth legacy operations. Investors may also be concerned that the digital transformation has not yet offset the broader decline.
• Negative Sentiment: Wells Fargo lowered its price target from $9.00 to $7.50 and kept an “equal weight” rating, signaling more limited near-term upside and a more cautious view of the turnaround. Wells Fargo Price Target Update

Institutional Investors Weigh In On Lumen Technologies

Hedge funds and other institutional investors have recently made changes to their positions in the stock. JPMorgan Chase & Co. grew its holdings in Lumen Technologies by 324.7% in the 4th quarter. JPMorgan Chase & Co. now owns 22,211,742 shares of the technology company's stock valued at $172,585,000 after buying an additional 16,981,326 shares in the last quarter. Charles Schwab Investment Management Inc. boosted its position in shares of Lumen Technologies by 2.6% during the 4th quarter. Charles Schwab Investment Management Inc. now owns 18,390,473 shares of the technology company's stock valued at $142,894,000 after acquiring an additional 473,242 shares during the last quarter. Dimensional Fund Advisors LP boosted its position in shares of Lumen Technologies by 1.0% during the 1st quarter. Dimensional Fund Advisors LP now owns 14,994,640 shares of the technology company's stock valued at $104,156,000 after acquiring an additional 144,664 shares during the last quarter. Norges Bank purchased a new stake in shares of Lumen Technologies in the fourth quarter valued at about $106,557,000. Finally, Front Street Capital Management Inc. increased its position in Lumen Technologies by 1.1% during the second quarter. Front Street Capital Management Inc. now owns 11,969,084 shares of the technology company's stock worth $52,425,000 after purchasing an additional 132,131 shares during the last quarter. Institutional investors and hedge funds own 66.19% of the company's stock.

Lumen Technologies Stock Down 8.4%

The company's 50-day moving average is $7.70 and its 200-day moving average is $7.88. The stock has a market capitalization of $6.33 billion, a price-to-earnings ratio of -3.54 and a beta of 1.78.

Lumen Technologies (NYSE:LUMN - Get Free Report) last released its quarterly earnings results on Tuesday, August 4th. The technology company reported ($0.07) EPS for the quarter, beating the consensus estimate of ($0.13) by $0.06. The firm had revenue of $2.81 billion for the quarter, compared to analysts' expectations of $2.74 billion. During the same period in the previous year, the firm posted ($0.03) EPS. The firm's quarterly revenue was down 9.3% compared to the same quarter last year. Sell-side analysts anticipate that Lumen Technologies, Inc. will post -0.39 EPS for the current year.

About Lumen Technologies

Lumen Technologies is a multinational technology company specializing in integrated network, edge cloud, security and collaboration services for enterprise and public sector clients. The company's core offerings include high-capacity fiber and IP-based connectivity, managed edge computing solutions designed to accelerate applications and data processing closer to end users, and cybersecurity services ranging from DDoS protection to unified threat management. Through its unified portfolio, Lumen enables organizations to support digital transformation initiatives, modernize infrastructure and enhance operational resilience.

Leveraging one of the largest fiber footprints in North America, as well as infrastructure in Latin America and parts of Europe, Lumen connects customers across more than 60 countries.

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