Lumentum (NASDAQ:LITE) Shares Gap Up - Still a Buy?

Key Points

• Lumentum shares opened sharply higher at $931.05 after closing at $890.17, but later traded near $869.53. The stock has a $65.21 billion market capitalization and a P/E ratio of 155.94.
• Analyst sentiment is favorable, with 14 Buy ratings and seven Holds producing a “Moderate Buy” consensus and an average price target of $1,012.67. Recent targets range from $960 to $1,300.
• Institutional investors own 94.05% of Lumentum, while insiders sold $22.1 million worth of shares over the past 90 days. The CFO’s sale was conducted under a pre-arranged plan to cover tax obligations tied to vested equity awards.

Lumentum Holdings Inc. (NASDAQ:LITE - Get Free Report) gapped up prior to trading on Monday . The stock had previously closed at $890.17, but opened at $931.05. Lumentum shares last traded at $869.5290, with a volume of 1,419,093 shares traded.

Analyst Ratings Changes

A number of brokerages have weighed in on LITE. Citic Securities boosted their target price on Lumentum from $620.00 to $1,186.00 in a research report on Monday, May 11th. Mizuho set a $1,100.00 price target on shares of Lumentum in a research note on Wednesday, May 6th. B. Riley Financial reissued a "buy" rating on shares of Lumentum in a report on Friday, May 1st. UBS Group boosted their price objective on shares of Lumentum from $455.00 to $960.00 and gave the company a "neutral" rating in a report on Wednesday, May 6th. Finally, BNP Paribas Exane increased their price objective on shares of Lumentum from $1,040.00 to $1,300.00 in a research report on Wednesday, May 6th. Fourteen investment analysts have rated the stock with a Buy rating and seven have issued a Hold rating to the stock. Based on data from MarketBeat.com, the company currently has an average rating of "Moderate Buy" and an average target price of $1,012.67.

Lumentum Stock Performance

The company has a debt-to-equity ratio of 0.01, a quick ratio of 0.97 and a current ratio of 1.14. The stock has a market cap of $65.21 billion, a P/E ratio of 155.94 and a beta of 1.50. The business's 50-day moving average price is $815.23 and its 200-day moving average price is $756.94.

Insider Activity at Lumentum

In other news, CFO Wajid Ali sold 2,487 shares of the firm's stock in a transaction dated Monday, May 18th. The stock was sold at an average price of $953.95, for a total value of $2,372,473.65. Following the transaction, the chief financial officer owned 60,951 shares of the company's stock, valued at $58,144,206.45. This trade represents a 3.92% decrease in their ownership of the stock. The transaction was disclosed in a filing with the Securities & Exchange Commission, which is available through this hyperlink. 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 Isaac Hosojiro Harris sold 4,000 shares of Lumentum stock in a transaction dated Friday, May 29th. The shares were sold at an average price of $860.00, for a total value of $3,440,000.00. Following the transaction, the director directly owned 8,400 shares in the company, valued at approximately $7,224,000. The trade was a 32.26% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders sold 23,827 shares of company stock valued at $22,051,069 in the last ninety days. Corporate insiders own 0.43% of the company's stock.

Institutional Inflows and Outflows

A number of hedge funds have recently made changes to their positions in the stock. Arrowstreet Capital Limited Partnership increased its stake in shares of Lumentum by 8,579.2% in the third quarter. Arrowstreet Capital Limited Partnership now owns 1,563,210 shares of the technology company's stock worth $254,350,000 after purchasing an additional 1,545,199 shares in the last quarter. Norges Bank purchased a new position in shares of Lumentum during the 4th quarter valued at $474,495,000. Value Aligned Research Advisors LLC purchased a new position in shares of Lumentum during the 4th quarter valued at $432,062,000. Situational Awareness LP boosted its holdings in Lumentum by 210.9% in the 4th quarter. Situational Awareness LP now owns 1,298,400 shares of the technology company's stock worth $478,577,000 after buying an additional 880,800 shares during the period. Finally, Aspex Management HK Ltd bought a new position in Lumentum in the 4th quarter worth $251,363,000. 94.05% of the stock is currently owned by institutional investors.

About Lumentum

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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