Lumentum (NASDAQ:LITE) Stock Price Down 9.8% on Analyst Downgrade

Lumentum Holdings Inc. (NASDAQ:LITE)’s share price dropped 9.8% on Monday after Zacks Research downgraded the stock from a strong-buy rating to a hold rating. The stock traded as low as $980.00 and last traded at $995.41. Approximately 6,405,490 shares traded hands during trading, an increase of 17% from the average daily volume of 5,497,861 shares. The stock had previously closed at $1,103.35.

A number of other research analysts have also recently weighed in on the company. Weiss Ratings cut Lumentum from a “hold (c-)” rating to a “sell (d-)” rating in a research report on Wednesday, August 19th. Deutsche Bank Aktiengesellschaft began coverage on shares of Lumentum in a research note on Monday, August 31st. They set a “buy” rating and a $1,200.00 target price on the stock. Evercore assumed coverage on shares of Lumentum in a research note on Monday, August 31st. They set an “outperform” rating and a $1,100.00 target price on the stock. Stifel Nicolaus lifted their price target on shares of Lumentum from $1,100.00 to $1,232.00 and gave the company a “buy” rating in a report on Monday, October 5th. Finally, Citigroup upped their price target on shares of Lumentum from $1,200.00 to $1,400.00 and gave the stock a “buy” rating in a research report on Monday, September 28th. Sixteen equities research analysts have rated the stock with a Buy rating, six have given a Hold rating and one has assigned a Sell rating to the company’s stock. According to data from MarketBeat.com, the company has a consensus rating of “Moderate Buy” and an average target price of $1,078.75.

Insider Transactions at Lumentum

In other Lumentum news, CFO Wajid Ali sold 24,542 shares of Lumentum stock in a transaction that occurred on 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 of the company’s stock, valued at $78,715,089. The trade was a 24.64% decrease in their position. The transaction was disclosed in a legal filing with the SEC, 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 Lumentum stock in a transaction that occurred on Tuesday, September 29th. The stock was sold at an average price of $945.00, for a total value of $290,115.00. Following the completion of the sale, the insider directly owned 108,320 shares in the company, valued at approximately $102,362,400. The trade was 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 94,496 shares of company stock worth $85,978,498 over the last quarter. 0.28% of the stock is owned by company insiders.

Trending Headlines about Lumentum

Here are the key news stories impacting Lumentum this week:

• Positive Sentiment: Strong AI-driven backlog: Recent reports highlight that Lumentum’s order book has reached a landmark level, with demand reportedly exceeding supply and product commitments extending through 2029. The company also participated in a PCIe-over-optics demonstration for AI rack-scale systems. Lumentum’s Massive Backlog and Demand Justify Buying at Today’s Price
• Positive Sentiment: Analyst target increase: Stifel raised its price target for Lumentum from $1,100 to $1,232, reflecting continued confidence in the company’s growth prospects. Stifel raised target for Lumentum stock
• Neutral Sentiment: Mixed investment views: Commentary points to improving free cash flow, significant net cash and potentially strong fiscal 2027 growth, but also notes that Lumentum trades at a demanding valuation following its large year-to-date gain. Lumentum: The Free Cash Flow Inflection I’m Betting On
• Negative Sentiment: AI funding concerns: Investors are questioning whether spending on AI data centers can remain durable, triggering a sector-wide retreat involving Lumentum, Coherent and Applied Optoelectronics. The concern is that long-term commitments may not fully protect suppliers if customers slow or defer infrastructure investment. AI funding fears hit optical stocks
• Negative Sentiment: Rating downgrade: Zacks Research moved Lumentum from “strong buy” to “hold,” adding to caution after the stock’s sharp run-up.

Institutional Investors Weigh In On Lumentum

A number of hedge funds have recently bought and sold shares of LITE. Fairfield Financial Advisors LTD grew its stake in shares of Lumentum by 27.4% in the 3rd quarter. Fairfield Financial Advisors LTD now owns 330 shares of the technology company’s stock worth $321,000 after buying an additional 71 shares in the last quarter. N10 Wealth LLC raised its position in shares of Lumentum by 31.9% during the 3rd quarter. N10 Wealth LLC now owns 9,093 shares of the technology company’s stock valued at $8,832,000 after buying an additional 2,197 shares in the last quarter. N10 Assets LLC raised its position in shares of Lumentum by 26.3% during the 3rd quarter. N10 Assets LLC now owns 8,608 shares of the technology company’s stock valued at $8,361,000 after buying an additional 1,794 shares in the last quarter. Generate Investment Management Ltd lifted its holdings in shares of Lumentum by 299.1% in the 3rd quarter. Generate Investment Management Ltd now owns 63,855 shares of the technology company’s stock valued at $62,020,000 after acquiring an additional 47,855 shares during the last quarter. Finally, First Citizens Bank & Trust Co. bought a new position in shares of Lumentum in the 3rd quarter valued at about $1,323,000. Hedge funds and other institutional investors own 94.05% of the company’s stock.

Lumentum Trading Down 9.3%

The company has a market cap of $81.19 billion, a PE ratio of -10.90 and a beta of 1.53. The company has a debt-to-equity ratio of 0.01, a current ratio of 1.68 and a quick ratio of 1.40. The company has a 50-day moving average of $930.77 and a 200 day moving average of $873.79.

Lumentum (NASDAQ:LITE) last released its earnings results on Tuesday, August 11th. The technology company reported $3.23 earnings per share (EPS) for the quarter, topping the consensus estimate 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 firm had revenue of $1.01 billion during the quarter, compared to analyst estimates of $987.70 million. During the same quarter last year, the business earned $0.88 EPS. The business’s revenue was up 109.3% on a year-over-year basis. Lumentum has set its Q1 2027 guidance at 4.050-4.350 EPS. Analysts predict that Lumentum Holdings Inc. will post 19.79 earnings per share for the current year.

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.