Lumentum (NASDAQ:LITE) Shares Up 1.4% - Still a Buy?

Key Points

• Lumentum shares rose 1.4% to $941.65, while trading volume fell below its average. The stock remains above its 50-day and 200-day moving averages.
• Analyst sentiment is broadly positive, with a consensus “Moderate Buy” rating and an average price target of $1,053.83; recent targets range from $1,100 to $1,300, despite one downgrade to “Sell.”
• Lumentum reported strong quarterly results, including $3.23 EPS and $1.01 billion in revenue, with revenue up 109.3% year over year. Institutional ownership is high at 94.05%, though insiders have sold about $59 million in stock over the past 90 days.

Lumentum Holdings Inc. (NASDAQ:LITE - Get Free Report)'s share price traded up 1.4% during mid-day trading on Friday. The stock traded as high as $962.88 and last traded at $941.65. Approximately 3,840,887 shares traded hands during trading, a decline of 31% from the average daily volume of 5,531,624 shares. The stock had previously closed at $929.04.

Analyst Ratings Changes

Several equities analysts have weighed in on the company. JPMorgan Chase & Co. raised their price objective on Lumentum from $1,165.00 to $1,280.00 and gave the company an "overweight" rating in a research note on Wednesday, August 12th. Weiss Ratings downgraded shares of Lumentum from a "hold (c-)" rating to a "sell (d-)" rating in a report on Wednesday, August 19th. Northland Securities raised their price target on shares of Lumentum from $1,000.00 to $1,200.00 and gave the company an "outperform" rating in a research report on Wednesday, June 3rd. Rosenblatt Securities restated a "buy" rating and set a $1,300.00 price target on shares of Lumentum in a report on Wednesday. Finally, Evercore began coverage on shares of Lumentum in a research note on Monday, August 31st. They issued an "outperform" rating and a $1,100.00 price objective for the company. One equities research analyst has rated the stock with a Strong Buy rating, fifteen have assigned a Buy rating, five have given a Hold rating and one has given a Sell rating to the stock. Based on data from MarketBeat.com, Lumentum presently has a consensus rating of "Moderate Buy" and a consensus target price of $1,053.83.

Lumentum Price Performance

The company has a current ratio of 1.68, a quick ratio of 1.40 and a debt-to-equity ratio of 0.01. The stock has a market cap of $84.47 billion, a PE ratio of -11.45 and a beta of 1.53. The business has a 50-day moving average price of $857.86 and a 200 day moving average price of $842.63.

Lumentum (NASDAQ:LITE - Get Free Report) last released its quarterly earnings data on Tuesday, August 11th. The technology company reported $3.23 earnings per share for the quarter, beating analysts' consensus estimates of $2.97 by $0.26. Lumentum had a negative net margin of 230.15% and a positive return on equity of 26.34%. The business had revenue of $1.01 billion during the quarter, compared to analyst estimates of $987.70 million. During the same period in the previous year, the business earned $0.88 EPS. Lumentum's revenue was up 109.3% compared to the same quarter last year. Lumentum has set its Q1 2027 guidance at 4.050-4.350 EPS. As a group, research analysts forecast that Lumentum Holdings Inc. will post 19.78 earnings per share for the current fiscal year.

Insider Activity

In other news, CEO Michael Hurlston sold 548 shares of the company's stock in a transaction on Thursday, August 27th. The shares were sold at an average price of $958.66, for a total value of $525,345.68. Following the transaction, the chief executive officer owned 186,951 shares of the company's stock, valued at approximately $179,222,445.66. This represents a 0.29% decrease in their ownership of the stock. The transaction was disclosed in a document filed with the SEC, which can be accessed through the SEC website. Also, insider Yuen Wupen sold 1,500 shares of the company's stock in a transaction dated Thursday, August 20th. The stock was sold at an average price of $827.82, for a total value of $1,241,730.00. Following the completion of the transaction, the insider owned 100,434 shares in the company, valued at $83,141,273.88. This represents a 1.47% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. 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. Insiders have sold 68,647 shares of company stock valued at $59,013,971 over the last 90 days. Company insiders own 0.43% of the company's stock.

Institutional Investors Weigh In On Lumentum

A number of hedge funds and other institutional investors have recently added to or reduced their stakes in the company. Jupiter Topco LLC bought a new position in Lumentum in the 2nd quarter worth $1,621,396,000. Norges Bank purchased a new position in shares of Lumentum during the fourth quarter valued at about $474,495,000. Situational Awareness LP increased its position in shares of Lumentum by 210.9% during the fourth quarter. Situational Awareness LP now owns 1,298,400 shares of the technology company's stock valued at $478,577,000 after buying an additional 880,800 shares during the period. Aspex Management HK Ltd bought a new position in Lumentum in the fourth quarter worth about $251,363,000. Finally, WT Asset Management Ltd bought a new position in Lumentum in the second quarter worth about $494,688,000. 94.05% of the stock is currently owned by institutional investors.

About Lumentum

Lumentum Holdings Inc NASDAQ: LITE designs and manufactures optical and photonic products used to transmit, process and control light. Its portfolio includes optical components, modules, subsystems, lasers and photonic integrated circuits that support communications networks, data centers, cloud infrastructure and industrial applications.

The company also supplies technologies for consumer electronics and 3D sensing, including laser-based products used in applications such as depth sensing and facial recognition.

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