Lumentum (NASDAQ:LITE) Shares Gap Up on Analyst Upgrade

Key Points

• Analyst upgrade sparked a sharp rally: Sanford C. Bernstein raised its Lumentum price target from $635 to $700 and maintained an outperform rating; shares opened at $641.50 after closing at $585.57.
• Wall Street sentiment is broadly positive: Lumentum has a consensus “Moderate Buy” rating and an average price target of $1,053.17, though analyst views range from strong buy to sell.
• Recent results beat earnings expectations: The company reported quarterly EPS of $4.57 versus $4.22 expected, while revenue rose 136.5% year over year to $1.26 billion. Insiders have also sold shares worth about $86 million over the past 90 days.

Shares of Lumentum Holdings Inc. (NASDAQ:LITE - Get Free Report) gapped up before the market opened on Wednesday after Sanford C. Bernstein raised their price target on the stock from $635.00 to $700.00. The stock had previously closed at $585.57, but opened at $641.50. Sanford C. Bernstein currently has an outperform rating on the stock. Lumentum shares last traded at $649.3090, with a volume of 1,432,231 shares trading hands.

A number of other brokerages also recently issued reports on LITE. Raymond James Financial raised shares of Lumentum from a "moderate buy" rating to a "strong-buy" rating and set a $1,328.00 price objective on the stock in a research report on Monday, November 2nd. Zacks Research cut shares of Lumentum from a "strong-buy" rating to a "hold" rating in a research report on Monday, October 12th. Morgan Stanley raised their target price on shares of Lumentum from $900.00 to $1,000.00 and gave the company an "equal weight" rating in a research note on Wednesday, August 12th. Stonex Financial upgraded shares of Lumentum to a "strong-buy" rating in a research note on Monday, October 26th. Finally, Citigroup lifted their price target on shares of Lumentum from $1,200.00 to $1,400.00 and gave the stock a "buy" rating in a report on Monday, September 28th. Two investment analysts have rated the stock with a Strong Buy rating, fourteen have issued a Buy rating, seven have given a Hold rating and one has assigned a Sell rating to the company's stock. According to MarketBeat.com, Lumentum has an average rating of "Moderate Buy" and a consensus target price of $1,053.17.

Insider Buying and Selling at Lumentum

In other news, CFO Wajid Ali sold 24,542 shares of the company's stock in a transaction dated Thursday, October 1st. The stock was sold at an average price of $1,048.50, for a total value of $25,732,287.00. Following the sale, the chief financial officer owned 75,074 shares in the company, valued at $78,715,089. This represents a 24.64% decrease in their ownership of the stock. The sale was disclosed in a filing with the Securities & Exchange Commission, which is available through the SEC website. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, insider Yuen Wupen sold 307 shares of the firm's stock in a transaction that occurred on Tuesday, September 29th. The stock was sold at an average price of $945.00, for a total transaction of $290,115.00. Following the sale, the insider directly owned 108,320 shares in the company, valued at $102,362,400. The trade was a 0.28% decrease in their position. The SEC filing for this sale provides additional information. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Over the last ninety days, insiders sold 94,496 shares of company stock worth $85,978,498. 0.28% of the stock is owned by corporate insiders.

Hedge Funds Weigh In On Lumentum

A number of large investors have recently added to or reduced their stakes in the stock. Red Spruce Capital LLC grew its position in shares of Lumentum by 0.4% in the third quarter. Red Spruce Capital LLC now owns 3,200 shares of the technology company's stock valued at $3,108,000 after purchasing an additional 12 shares during the period. CYBER HORNET ETFs LLC lifted its stake in Lumentum by 7.2% in the 2nd quarter. CYBER HORNET ETFs LLC now owns 209 shares of the technology company's stock valued at $179,000 after buying an additional 14 shares in the last quarter. Hilltop National Bank boosted its holdings in Lumentum by 26.8% in the 2nd quarter. Hilltop National Bank now owns 71 shares of the technology company's stock worth $61,000 after buying an additional 15 shares during the last quarter. TrinityBridge Ltd boosted its holdings in Lumentum by 35.8% in the 3rd quarter. TrinityBridge Ltd now owns 72 shares of the technology company's stock worth $70,000 after buying an additional 19 shares during the last quarter. Finally, Signature Equity Partners LLC boosted its holdings in Lumentum by 220.0% in the 3rd quarter. Signature Equity Partners LLC now owns 32 shares of the technology company's stock worth $31,000 after buying an additional 22 shares during the last quarter. 94.05% of the stock is currently owned by institutional investors and hedge funds.

Lumentum Trading Up 10.3%

The company has a 50 day simple moving average of $881.57 and a 200 day simple moving average of $803.93. The company has a debt-to-equity ratio of 0.01, a quick ratio of 1.27 and a current ratio of 1.61. The company has a market capitalization of $58.59 billion, a PE ratio of -8.23 and a beta of 1.64.

Lumentum (NASDAQ:LITE - Get Free Report) last released its earnings results on Monday, November 2nd. The technology company reported $4.57 earnings per share for the quarter, beating the consensus estimate of $4.22 by $0.35. The business had revenue of $1.26 billion for the quarter, compared to the consensus estimate of $1.26 billion. Lumentum had a positive return on equity of 28.85% and a negative net margin of 175.82%. The business's quarterly revenue was up 136.5% compared to the same quarter last year. During the same quarter last year, the business posted $1.10 earnings per share. Analysts anticipate that Lumentum Holdings Inc. will post 19.93 earnings per share for the current year.

Lumentum Company Profile

Lumentum Holdings Inc. develops and manufactures optical and photonic products used in communications networks and industrial applications. Its offerings include optical components, modules and lasers that help transmit and process data across telecommunications and data center networks. The company also supplies lasers and related technologies for industrial uses, including precision manufacturing and semiconductor production. Its products serve customers in markets around the world. Lumentum became an independent public company in 2015 through a spin-off from JDSU, now Viavi Solutions.

This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to contact@marketbeat.com.