Lumentum (NASDAQ:LITE) Shares Down 7.6% - Should You Sell?

Key Points

• Lumentum shares fell 7.6% to $602.35 on elevated trading volume, well below its 50-day and 200-day moving averages.
• Analysts remain broadly optimistic, with 14 Buy ratings and seven Holds producing a “Moderate Buy” consensus and an average price target of $1,012.67.
• The company exceeded quarterly earnings expectations and reported 90.1% year-over-year revenue growth, though insiders have sold about $38.9 million of stock over the past three months.

Lumentum Holdings Inc. (NASDAQ:LITE - Get Free Report)'s share price was down 7.6% on Wednesday . The stock traded as low as $594.84 and last traded at $602.35. 6,313,804 shares were traded during trading, an increase of 10% from the average daily volume of 5,757,388 shares. The stock had previously closed at $651.93.

Wall Street Analysts Forecast Growth

A number of research analysts have weighed in on the company. Barclays upped their target price on Lumentum from $750.00 to $1,000.00 and gave the stock an "equal weight" rating in a report on Wednesday, May 6th. UBS Group lifted their price target on Lumentum from $455.00 to $960.00 and gave the company a "neutral" rating in a research report on Wednesday, May 6th. Susquehanna lifted their price target on Lumentum from $550.00 to $1,100.00 and gave the company a "positive" rating in a research report on Monday, April 20th. B. Riley Financial reaffirmed a "buy" rating on shares of Lumentum in a research note on Friday, May 1st. Finally, Mizuho set a $1,100.00 price objective on Lumentum in a report on Wednesday, May 6th. Fourteen analysts have rated the stock with a Buy rating and seven have issued a Hold rating to the stock. Based on data from MarketBeat, the company has an average rating of "Moderate Buy" and an average target price of $1,012.67.

Lumentum Price Performance

The firm has a market cap of $46.86 billion, a P/E ratio of 111.55 and a beta of 1.48. The company has a debt-to-equity ratio of 0.01, a current ratio of 1.14 and a quick ratio of 0.97. The firm's 50 day moving average is $836.46 and its 200 day moving average is $732.51.

Lumentum (NASDAQ:LITE - Get Free Report) last announced its earnings results on Tuesday, May 5th. The technology company reported $2.37 earnings per share for the quarter, beating analysts' consensus estimates of $2.27 by $0.10. Lumentum had a net margin of 17.61% and a return on equity of 24.81%. The business had revenue of $808.40 million during the quarter, compared to the consensus estimate of $810.21 million. During the same quarter last year, the firm earned $0.57 earnings per share. The business's revenue for the quarter was up 90.1% on a year-over-year basis. Lumentum has set its Q4 2026 guidance at 2.850-3.050 EPS. As a group, analysts anticipate that Lumentum Holdings Inc. will post 6.42 earnings per share for the current year.

Insider Buying and Selling

In other Lumentum news, SVP Jae Kim sold 1,422 shares of the business's stock in a transaction on Monday, May 18th. The stock was sold at an average price of $953.95, for a total value of $1,356,516.90. Following the sale, the senior vice president directly owned 32,333 shares of the company's stock, valued at approximately $30,844,065.35. The trade was a 4.21% decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the SEC, which can be accessed through this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Also, Director Ian Small sold 4,954 shares of the business's stock in a transaction on Thursday, May 21st. The stock was sold at an average price of $868.07, for a total value of $4,300,418.78. Following the completion of the sale, the director directly owned 21,008 shares in the company, valued at $18,236,414.56. This trade represents a 19.08% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. Insiders have sold a total of 41,260 shares of company stock worth $38,859,220 over the last three months. Corporate insiders own 0.43% of the company's stock.

Hedge Funds Weigh In On Lumentum

Several institutional investors and hedge funds have recently modified their holdings of the stock. Hilton Head Capital Partners LLC bought a new position in Lumentum in the 1st quarter worth about $25,000. Sachetta LLC grew its position in Lumentum by 118.8% during the 1st quarter. Sachetta LLC now owns 35 shares of the technology company's stock valued at $25,000 after purchasing an additional 19 shares during the last quarter. Wiser Advisor Group LLC increased its stake in Lumentum by 6,000.0% during the 1st quarter. Wiser Advisor Group LLC now owns 61 shares of the technology company's stock valued at $43,000 after purchasing an additional 60 shares in the last quarter. Harbor Investment Advisory LLC increased its stake in Lumentum by 1,140.0% during the 2nd quarter. Harbor Investment Advisory LLC now owns 62 shares of the technology company's stock valued at $53,000 after purchasing an additional 57 shares in the last quarter. Finally, SJS Investment Consulting Inc. raised its holdings in Lumentum by 687.5% in the first quarter. SJS Investment Consulting Inc. now owns 63 shares of the technology company's stock worth $44,000 after buying an additional 55 shares during the last quarter. 94.05% of the stock is currently owned by institutional investors.

Lumentum Company Profile

Lumentum Holdings Inc, headquartered in San Jose, California, is a leading provider of photonic technologies that enable high-speed optical communication networks and advanced industrial applications. The company designs and manufactures a broad range of lasers, optical modules and subsystems tailored to the evolving requirements of telecommunications carriers, cloud data centers and enterprise networking.

Its core product portfolio includes tunable and fixed-wavelength laser transmitters, coherent optical engines, transceivers for long-haul, metro and data center interconnects, as well as test and measurement instruments.

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