Lumentum (NASDAQ:LITE) Stock Price Down 9.8% - Should You Sell?

Key Points

• Lumentum shares fell 9.8% to about $995.41 in heavy trading, while remaining above their 50-day and 200-day moving averages.
• Analysts remain broadly positive, with a consensus “Moderate Buy” rating and an average price target of $1,078.75; several firms recently raised targets as high as $1,400.
• The company reported strong quarterly results, beating earnings and revenue estimates, with revenue up 109.3% year over year. However, insiders sold $86.0 million of stock over the past 90 days, including a sizable CFO transaction under a prearranged trading plan.

Lumentum Holdings Inc. (NASDAQ:LITE - Get Free Report)'s share price was down 9.8% during mid-day trading on Monday. The company traded as low as $980.00 and last traded at $995.41. 6,405,490 shares changed hands during mid-day trading, an increase of 17% from the average session volume of 5,497,861 shares. The stock had previously closed at $1,103.35.

Analysts Set New Price Targets

A number of equities analysts have recently commented on LITE shares. Wolfe Research reaffirmed an "outperform" rating on shares of Lumentum in a report on Friday, August 21st. Citigroup boosted their price target on shares of Lumentum from $1,200.00 to $1,400.00 and gave the company a "buy" rating in a research report on Monday, September 28th. Deutsche Bank Aktiengesellschaft began coverage on Lumentum in a research report on Monday, August 31st. They set a "buy" rating and a $1,200.00 target price for the company. Rosenblatt Securities reissued a "buy" rating and issued a $1,300.00 price target on shares of Lumentum in a report on Monday, October 5th. Finally, Needham & Company LLC reissued a "buy" rating and set a $1,040.00 price objective on shares of Lumentum in a report on Wednesday, August 12th. One research analyst has rated the stock with a Strong Buy rating, sixteen have issued a Buy rating, five have given a Hold rating and one has assigned a Sell rating to the stock. Based on data from MarketBeat, the company currently has a consensus rating of "Moderate Buy" and a consensus target price of $1,078.75.

Lumentum Price Performance

The company has a market cap of $90.17 billion, a PE ratio of -12.11 and a beta of 1.53. The firm's 50-day moving average is $923.68 and its 200-day moving average is $870.95. The company has a quick ratio of 1.40, a current ratio of 1.68 and a debt-to-equity ratio of 0.01.

Lumentum (NASDAQ:LITE - Get Free Report) last released its earnings results on Tuesday, August 11th. The technology company reported $3.23 EPS for the quarter, beating analysts' consensus estimates of $2.97 by $0.26. The company had revenue of $1.01 billion during the quarter, compared to analysts' expectations of $987.70 million. Lumentum had a positive return on equity of 26.34% and a negative net margin of 230.15%. The firm's revenue for the quarter was up 109.3% compared to the same quarter last year. During the same quarter last year, the business posted $0.88 EPS. Lumentum has set its Q1 2027 guidance at 4.050-4.350 EPS. On average, equities analysts anticipate that Lumentum Holdings Inc. will post 19.78 EPS for the current year.

Insider Activity at Lumentum

In other Lumentum news, CFO Wajid Ali sold 24,542 shares of the firm's stock in a transaction dated Thursday, October 1st. The shares were sold at an average price of $1,048.50, for a total transaction of $25,732,287.00. Following the completion of the sale, the chief financial officer directly owned 75,074 shares in the company, valued at approximately $78,715,089. This trade represents a 24.64% decrease in their position. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which can be accessed through this hyperlink. 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 shares were 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 of the company's stock, valued at $102,362,400. This trade represents a 0.28% decrease in their position. 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. Insiders sold a total of 94,496 shares of company stock worth $85,978,498 in the last 90 days. 0.43% of the stock is currently owned by company insiders.

Hedge Funds Weigh In On Lumentum

A number of hedge funds have recently bought and sold shares of the business. GK Wealth Management LLC increased its holdings in shares of Lumentum by 10.5% in the third quarter. GK Wealth Management LLC now owns 716 shares of the technology company's stock worth $695,000 after purchasing an additional 68 shares during the last quarter. Riversedge Advisors LLC boosted its stake in Lumentum by 14.7% during the third quarter. Riversedge Advisors LLC now owns 327 shares of the technology company's stock worth $318,000 after buying an additional 42 shares during the period. Wedmont Private Capital boosted its stake in shares of Lumentum by 93.3% during the 3rd quarter. Wedmont Private Capital now owns 3,065 shares of the technology company's stock worth $3,214,000 after purchasing an additional 1,479 shares during the period. GAMMA Investing LLC grew its stake in shares of Lumentum by 8.9% during the third quarter. GAMMA Investing LLC now owns 3,623 shares of the technology company's stock valued at $3,519,000 after buying an additional 295 shares during the last quarter. Finally, Farther Finance Advisors LLC increased its stake in Lumentum by 5.4% in the third quarter. Farther Finance Advisors LLC now owns 3,296 shares of the technology company's stock worth $3,202,000 after purchasing an additional 169 shares during the period. Hedge funds and other institutional investors own 94.05% of the company's stock.

Lumentum Company Profile

Lumentum Holdings Inc is a photonics and optical technology company that develops and manufactures products used to transmit, process and manage light. Its solutions support communications networks, data centers, cloud computing infrastructure, industrial applications, and other technology markets that rely on high-speed optical connectivity and precision lasers.

The company's product portfolio includes optical components and modules for telecommunications and networking, lasers and laser systems, optical amplifiers, wavelength-management products, and photonic subsystems.

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