Americké akciové trhy rostou díky naději na obnovení rozhovorů mezi USA a Íránem a zmírnění napětí na Blízkém východě.
Širší index S&P 500 posiluje o 0,41 % na 7438,47 bodu a index Dow Jones si připisuje 0,56 % na 52002,68 bodu. Technologie však mírně zaostávají, technologický Nasdaq Composite odepisuje 0,07 % na 25120,91 bodu. Pozitivní náladu na trhu podporuje také úspěšný start výsledkové sezóny, v níž většina firem překonává očekávání ziskovosti.
V rámci jednotlivých odvětví indexu S&P 500 vykazují nejsilnější růst reality o 2,6 %, následované základními materiály s nárůstem o 1,2 % a nezbytnou spotřebou, která si připisuje 0,8 %. Na druhé straně zaznamenávají jen mírné zisky zbytná spotřeba, informační technologie i utility, které shodně přidávají 0,1 %.
Mezi nejsilnější individuální akcie se řadí Digital Realty Trust (DLR) s prudkým růstem o 14 %. Výrazně posiluje také SLB (SLB) o 10 %, Smurfit Westrock (SW) o 7,9 %, Equinix (EQIX) o 6,3 % a International Paper (IP), která si připisuje 6,2 %. Na opačné straně trhu po výprodejích v technologickém a dodavatelském sektoru klesá Coherent Corp (COHR) o 7,8 %. Nedaří se ani firmám Sandisk Corp (SNDK) a CH Robinson Worldwide (CHRW), které shodně odepisují 7,5 %, Lumentum Holdings (LITE) s poklesem o 6,9 % a Robinhood Markets (HOOD), jež oslabuje o 6,1 %.
Zprávy o možném uklidnění situace na Blízkém východě tlačí dolů ceny energií. Severoamerická lehká ropa WTI klesá o 4,2 % na 88,31 dolaru za barel. Spotové zlato naopak mírně posiluje o 0,4 % na 4064,95 dolaru za unci. Americký dolar vykazuje stabilní vývoj, když k euru zůstává téměř bez změny na 1,1379 dolaru, britská libra mírně roste o 0,1 % na 1,3333 dolaru a japonský jen drží úroveň 163,76 jenu za dolar. Pokles cen ropy zmírňuje obavy z inflace, což vede ke poklesu výnosů desetiletých amerických vládních dluhopisů o tři bazické body na 4,66 %. Bitcoin reaguje na celkový vývoj poklesem o 1,9 % na 63850,84 dolaru.
Index Dow Jones +0,56 % na 52002,68 b.
S&P 500 +0,41 % na 7438,47 b.
Nasdaq Composite -0,07 % na 25120,91 b.
Index S&P 500 +0,41 % na 7438,47 b. Nejsilnější sektory S&P Změna Nejslabší sektory S&P Změna Reality +2,6 % Zbytná spotřeba +0,1 % Základní materiály +1,2 % Informační technologie +0,1 % Nezbytná spotřeba +0,8 % Utility +0,1 % Nejsilnější akcie S&P Změna Nejslabší akcie S&P Změna Digital Realty Trust (DLR) +14 % Coherent Corp (COHR) -7,8 % SLB (SLB) +10 % Sandisk Corp (SNDK) -7,5 % Smurfit Westrock (SW) +7,9 % CH Robinson Worldwide (CHRW) -7,5 % Equinix (EQIX) +6,3 % Lumentum Holdings (LITE) -6,9 % International Paper (IP) +6,2 % Robinhood Markets (HOOD) -6,1 %
Daniel Marván, Fio banka, a.s.
Key Takeaways PENN's 2026 earnings are expected to soar 122.8%, with broker ratings up 10% in four weeks.CC's 2026 earnings are projected to jump 24.2%, while broker ratings rose 10% in four weeks.LITE's fiscal 2027 earnings may jump 121.8%, with broker ratings up 4.6% in four weeks. With the second-quarter earnings season in full swing, investors are closely evaluating companies’ quarterly performances. But investment decisions should not be driven solely by near-term results. It is equally important to consider the broader macroeconomic backdrop and assess how prevailing trends could influence a company’s fundamentals and long-term growth prospects.
Geopolitical tensions in the Middle East have pushed global oil prices higher, raising concerns that inflationary pressures could persist in the coming months. This, in turn, reinforces the Federal Reserve’s cautious approach to monetary policy. Investors should also remain mindful of stretched valuations in several artificial intelligence (AI)-related stocks, along with continued uncertainty surrounding tariffs and global trade policies. Against this backdrop, a careful assessment of company-specific strengths, valuation and earnings potential is essential before making investment decisions.
One way to cut short this task is to follow brokers’ recommendations. Stocks like PENN Entertainment, Inc. (PENN - Free Report) , The Chemours Company (CC - Free Report) and Lumentum Holdings Inc. (LITE - Free Report) are worth betting on.
Broker recommendations are typically based on a comprehensive research process involving direct discussions with company management, detailed reviews of regulatory filings, earnings-call assessments, channel checks and wider industry analysis. This enables analysts to judge a company’s fundamentals against macroeconomic developments, sector dynamics, competitive positioning and peer performance rather than evaluating the business in isolation.
A broker upgrade generally reflects a meaningful improvement in an analyst’s outlook for a company. The revision may be driven by several developments that are not yet fully incorporated into consensus estimates or the stock’s prevailing valuation. Therefore, an upgrade may signal a potential inflection point in earnings expectations and overall investor sentiment.
However, broker upgrades should not be viewed as stand-alone investment indicators. They are more effective when considered alongside other fundamental, earnings and valuation factors. Hence, broker recommendations are best used as one component of a broader and well-balanced investment decision-making process.
Selecting the Winning StrategyWe have a screening strategy that may help you identify potential winners.
Broker Rating Upgrades (Four Weeks) of 1% or More: The screen selects stocks that have witnessed broker rating upgrades of 1% or more over the past four weeks.
Current Price Greater Than $5: The stocks must trade above $5.
Average 20-Day Volume Greater Than 100,000: A large trading volume guarantees that the stock is easily tradable.
Zacks Rank Equal to #1 (Strong Buy) or 2 (Buy): Despite good or bad market conditions, stocks with a Zacks Rank #1 or 2 have a proven record of success. You can see the complete list of today’s Zacks #1 Rank stocks here.
VGM Score of A or B: Our research shows that stocks with a VGM Score of A or B, when combined with a Zacks Rank #1 or 2, offer the best upside potential.
3 Stocks With Upgraded Broker RatingsWyomissing, PA-based PENN Entertainment is a multi-jurisdictional owner and operator of gaming and racing facilities with video gaming terminal operations and a focus on slot-machine entertainment. PENN’s portfolio is geographically diverse and includes a broad set of regional properties.
PENN’s 2026 earnings are expected to soar 122.8% year over year. PENN Entertainment, which currently sports a Zacks Rank #1, has witnessed a 10% upward revision in broker ratings over the past four weeks.
Chemours, based in Wilmington, DE, is a leading provider of performance chemicals that are key ingredients in end-products and processes across a host of industries. CC offers its customers solutions across a vast spectrum of industries, including plastics and coatings, refrigeration and air conditioning, mining and general industrial manufacturing and electronics.
Chemours’ 2026 earnings are projected to jump 24.2% on a year-over-year basis. CC, sporting a Zacks Rank #1 at present, has seen a 10% increase in broker ratings over the past four weeks.
Headquartered in San Jose, CA, Lumentum is a provider of optical and photonic products serving cloud, AI/machine learning, telecommunications, consumer and industrial end markets. LITE’s technologies enable high-capacity optical links for intra-data center, data center interconnect, long-haul and submarine networks, and support enterprise networking across SANs, LANs and WANs.
Lumentum’s fiscal 2027 earnings are expected to jump 121.8% year over year. LITE, which currently carries a Zacks Rank #2, has witnessed a 4.6% upward revision in broker ratings over the past four weeks.
Dimensional Fund Advisors LP cut its position in Lumentum Holdings Inc. (NASDAQ:LITE – Free Report) by 29.2% during the first quarter, according to the company in its most recent disclosure with the Securities & Exchange Commission. The institutional investor owned 359,173 shares of the technology company’s stock after selling 147,812 shares during the period. Dimensional Fund Advisors LP owned 0.50% of Lumentum worth $252,271,000 as of its most recent SEC filing.
Other large investors have also bought and sold shares of the company. Hilton Head Capital Partners LLC acquired a new stake in Lumentum in the 1st quarter valued at about $25,000. Sachetta LLC raised its holdings in Lumentum by 118.8% during the 1st quarter. Sachetta LLC now owns 35 shares of the technology company’s stock worth $25,000 after purchasing an additional 19 shares during the last quarter. V Square Quantitative Management LLC bought a new stake in shares of Lumentum during the fourth quarter worth approximately $28,000. Truvestments Capital LLC raised its position in shares of Lumentum by 300.0% during the 4th quarter. Truvestments Capital LLC now owns 76 shares of the technology company’s stock valued at $28,000 after acquiring an additional 57 shares during the last quarter. Finally, Triumph Capital Management bought a new stake in Lumentum in the fourth quarter valued at about $30,000. 94.05% of the stock is currently owned by institutional investors.
Analyst Upgrades and Downgrades Several analysts recently commented on the company. Barclays raised their price objective on Lumentum from $750.00 to $1,000.00 and gave the stock an “equal weight” rating in a research note on Wednesday, May 6th. Rosenblatt Securities increased their price objective on shares of Lumentum from $900.00 to $1,300.00 and gave the stock a “buy” rating in a research report on Wednesday, May 6th. BNP Paribas Exane lifted their price target on Lumentum from $1,040.00 to $1,300.00 in a research note on Wednesday, May 6th. Loop Capital lifted their price objective on shares of Lumentum from $900.00 to $1,400.00 and gave the company a “buy” rating in a report on Tuesday, May 5th. Finally, UBS Group upped their target price on Lumentum from $455.00 to $960.00 and gave the stock a “neutral” rating in a report on Wednesday, May 6th. Fourteen equities research analysts have rated the stock with a Buy rating and seven have given a Hold rating to the company. According to data from MarketBeat.com, Lumentum has a consensus rating of “Moderate Buy” and an average price target of $1,012.67.
Check Out Our Latest Stock Analysis on Lumentum
Insider Buying and Selling In other news, SVP Jae Kim sold 1,422 shares of the stock in a transaction dated Monday, May 18th. The stock was sold at an average price of $953.95, for a total value of $1,356,516.90. Following the completion of the sale, the senior vice president owned 32,333 shares of the company’s stock, valued at approximately $30,844,065.35. This represents a 4.21% decrease in their ownership of the stock. The sale was disclosed in a filing with the SEC, which is accessible through the SEC website. 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, insider Vincent Retort sold 3,183 shares of the stock in a transaction on Monday, May 18th. The stock was sold at an average price of $953.95, for a total transaction of $3,036,422.85. Following the sale, the insider owned 89,563 shares of the company’s stock, valued at approximately $85,438,623.85. This trade represents a 3.43% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. 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 a total of 41,260 shares of company stock valued at $38,859,220 over the last quarter. 0.43% of the stock is currently owned by company insiders.
Lumentum Price Performance Lumentum stock opened at $833.64 on Friday. The company has a debt-to-equity ratio of 0.01, a current ratio of 1.14 and a quick ratio of 0.97. Lumentum Holdings Inc. has a one year low of $101.22 and a one year high of $1,085.68. The firm has a market cap of $64.86 billion, a PE ratio of 154.38 and a beta of 1.48. The stock’s fifty day moving average price is $848.84 and its two-hundred day moving average price is $725.62.
Lumentum (NASDAQ:LITE – Get Free Report) last announced its quarterly earnings data on Tuesday, May 5th. The technology company reported $2.37 EPS for the quarter, beating the consensus estimate of $2.27 by $0.10. The business had revenue of $808.40 million during the quarter, compared to the consensus estimate of $810.21 million. Lumentum had a net margin of 17.61% and a return on equity of 24.81%. The company’s revenue was up 90.1% on a year-over-year basis. During the same period in the previous year, the business earned $0.57 earnings per share. Lumentum has set its Q4 2026 guidance at 2.850-3.050 EPS. As a group, research analysts expect that Lumentum Holdings Inc. will post 6.42 EPS for the current fiscal year.
Lumentum Profile (Free Report)
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.
Read More Five stocks we like better than Lumentum Premium Retail’s Stress Test Is Separating Winners From Losers D-Wave Quantum or a Quantum ETF: Which Is the Better Bet? GE Vernova Just Sent a Mixed AI Signal to Investors Alphabet Crushed Earnings, But One Number Spooked the Market Want to see what other hedge funds are holding LITE? Visit HoldingsChannel.com to get the latest 13F filings and insider trades for Lumentum Holdings Inc. (NASDAQ:LITE – Free Report).
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Alphabet's latest earnings report has renewed optimism for companies like Lumentum supplying optical networking and data center components, even as investors scrutinize the rising cost of artificial intelligence infrastructure.
While some investors focused on Alphabet's higher capital expenditure plans, Stifel analysts said the company's results reinforced expectations that AI infrastructure spending remains robust.
“The first hyperscaler print this earnings cycle reinforces our view that the AI data center buildout is not decelerating,” the analysts wrote following Alphabet's quarterly results.
Alphabet's continued investment is viewed as a positive signal for suppliers of interconnects, optics and networking hardware used in AI data centers.
The company is one of several hyperscalers, alongside Microsoft and Amazon, that are investing heavily in expanding AI infrastructure.
According to Stifel, Alphabet's results support companies with significant exposure to AI data center deployments.
Stifel identified Lumentum Holdings, Celestica and Coherent as the hardware companies with the greatest exposure to Alphabet's spending.
The brokerage also pointed to Marvell Technology as an important supplier of optical digital signal processors, while Semtech was highlighted for its growing supply of active copper cable to Alphabet.
Monolithic Power Systems was also identified as having meaningful exposure through power-related products.
“This initial read is overwhelmingly positive for the space and should skew positive for the CapEx spend insights from the other hyperscaler reports to follow,” the analysts added.
The brokerage suggested investors could look at these companies ahead of earnings from other hyperscalers. Microsoft is scheduled to report results on July 29, followed by Amazon on July 30.
Lumentum shares gained after Barclays also upgraded the stock to Overweight, citing strong demand for the company's optical and laser components used in AI data centers.
Barclays also assigned a $1,000 price target while pointing to expectations ahead of Lumentum's fiscal fourth-quarter earnings in August.
Lumentum stock LITE gained 1.8% on Thursday's session.
Lumentum has increasingly positioned itself as a beneficiary of the AI infrastructure boom by expanding its portfolio of optical and photonic technologies.
According to Seeking Alpha analysts, the company has diversified beyond legacy telecommunications markets through acquisitions including Oclaro, NeoPhotonics, IPG Photonics and Cloud Light Technology.
These deals have expanded Lumentum's exposure to cloud computing, AI, machine learning and high-speed optical networking.
The company reported that its Cloud & Networking segment accounted for 85.7% of fiscal 2025 revenue, up from 58.9% in fiscal 2022 under its previous Telecom and Datacom reporting structure.
The analysts also highlighted several long-term growth opportunities, including Optical Circuit Switches, expanding optical scale-out deployments and the anticipated transition toward optical scale-up architectures beginning in 2028.
Lumentum reported fiscal third-quarter 2026 revenue of $808.4 million, up 90.1% year over year, supported by accelerating laser sales tied to AI infrastructure demand.
Looking ahead, the analysts said broader adoption of Co-Packaged Optics for application-specific integrated circuits could drive additional demand for Lumentum's next-generation ultra-high-power lasers beginning in 2027.
At the same time, the experts warned that Lumentum continues to face execution risks, including elevated debt levels, uneven cash generation and shortages of critical components that could affect future capacity expansion.
Every bull market has its unsung heroes — the companies doing essential work far from the spotlight.
In the AI infrastructure boom, few groups have been more essential, or more spectacularly rewarding, than the optical and photonics names that quite literally form the connective tissue of the data center.
These are the makers of the lasers, transceivers, and switches that shuttle data between GPUs at the speed of light. And over the past year, they’ve delivered some of the most jaw-dropping returns in the entire market.
A Year of Light Speed GainsConsider the scoreboard. Lumentum has soared roughly 700% over the past twelve months, dramatically outpacing even its high-flying industry. Corning has climbed more than 200% over the same stretch.
Image Source: StockCharts
These aren’t speculative penny stocks; they’re established, profitable enterprises being repriced in real time as the market grasps just how much optical hardware the AI buildout requires.
The demand drivers are powerful and multiplying: hyperscaler capital spending racing higher, the transition to 800-gigabit and 1.6-terabit transceivers, the emergence of optical circuit switching, and the coming wave of co-packaged optics. When Meta leaks a memo about doubling its compute, or Nvidia lays out its optical roadmap, these stocks move — because they’ve become a derivative on every gigawatt of AI compute announced anywhere, by anyone.
The Gut-Check PullbackBut parabolic moves rarely travel in a straight line, and early July delivered a sharp reminder. The optical complex pulled back roughly 15% to 20% from its early-June highs.
Importantly, the selloff had little to do with deteriorating fundamentals. It was a classic combination of profit-taking after a historic run, Lumentum’s removal from the Russell index triggering forced selling, and some hand-wringing over the precise timing of co-packaged optics adoption. When a stock has tripled or more, it doesn’t take much to spark a correction.
That gut-check appears to be giving way to a snapback. The group has been rebounding, and this week’s move extends that recovery as buyers step back in. The rebound has been underwritten by a wave of constructive analyst commentary — Barclays upgraded Lumentum to Overweight, JPMorgan reiterated its Overweight rating and framed the dip as a buying opportunity after its channel checks confirmed co-packaged optics adoption remains on track, and Citi placed the stock on an “upside catalyst watch” heading into earnings.
The message from the sell side is consistent: the pullback compressed some rich valuations without impairing the multi-year demand story underneath. Let’s look at our two names, because they offer very different ways to play the same theme.
Lumentum: The High-Octane Pure PlayLumentum (LITE - Free Report) is the purest, highest-octane expression of the trade — and it now carries a Zacks Rank #2 (Buy), thanks to a recent upgrade on the back of rising earnings estimates. Back in May, the company reported record fiscal third-quarter revenue of $808.4 million, up a staggering 90% year over year, with non-GAAP operating margin expanding 700 basis points sequentially to 32%.
Image Source: Zacks Investment Research
Management pointed to an optical circuit switch backlog north of $400 million and a multi-hundred-million-dollar co-packaged optics order slated for the first half of 2027 — concrete evidence that the growth is contracted, not merely hoped for. A roughly $2 billion Nvidia-led investment and Lumentum’s addition to both the Nasdaq 100 and S&P 500 have only reinforced its centrality to the AI story.
Lumentum has topped estimates in each of its last four quarters, averaging a nearly 10% surprise. Fiscal fourth-quarter and full-year results are due August 11th after the close — a major near-term catalyst.
Corning: The Diversified Blue ChipCorning (GLW - Free Report) , which also commands a Zacks Rank #2 (Buy), offers the more measured, diversified route. Unlike pure-play Lumentum, Corning is a vertically integrated glass and materials powerhouse spanning optical communications, display, specialty materials, and a fast-growing solar business.
That diversification tempers both the upside and the risk. But make no mistake, AI is now the engine: Optical Communications sales jumped roughly 36% year over year last quarter to $1.85 billion, driving overall sales up 18% and EPS up 30%. The company has locked in multi-billion-dollar, multi-year supply agreements with the likes of Meta, Amazon, and Nvidia, and its “Springboard” plan targets a $40 billion sales run-rate by 2030.
Corning reports Q2 results on July 28th, before the market opens — even sooner than Lumentum — with estimates calling for roughly $4.6 billion in sales and EPS of $0.76. The 2026 consensus has been revised up to $3.18 per share, implying about 26% growth, and analysts at BofA and Citi carry targets north of $240. Corning also pays a dividend, giving investors a modest income cushion that the pure-plays lack.
Image Source: Zacks Investment Research
The Bottom LineThe AI-optics theme is as durable as any in the market, but the ride is genuinely turbulent, and customer concentration among a handful of hyperscalers is a real risk worth respecting.
These are two distinct vehicles for the same secular megatrend. Lumentum is the high-beta thoroughbred — explosive growth, a Buy-rated estimate trend, and maximum torque to AI optics. Corning is the steadier Clydesdale — diversified, dividend-paying, and a bit less exposed to any single quarter’s swings.
Looking for a stock that has been consistently beating earnings estimates and might be well positioned to keep the streak alive in its next quarterly report? Lumentum (LITE - Free Report) , which belongs to the Zacks Communication - Components industry, could be a great candidate to consider.
This optical networking products maker has an established record of topping earnings estimates, especially when looking at the previous two reports. The company boasts an average surprise for the past two quarters of 12.12%.
For the most recent quarter, Lumentum was expected to post earnings of $2.24 per share, but it reported $2.37 per share instead, representing a surprise of 5.80%. For the previous quarter, the consensus estimate was $1.41 per share, while it actually produced $1.67 per share, a surprise of 18.44%.
Price and EPS Surprise
Thanks in part to this history, there has been a favorable change in earnings estimates for Lumentum lately. In fact, the Zacks Earnings ESP (Expected Surprise Prediction) for the stock is positive, which is a great indicator of an earnings beat, particularly when combined with its solid Zacks Rank.
Our research shows that stocks with the combination of a positive Earnings ESP and a Zacks Rank #3 (Hold) or better produce a positive surprise nearly 70% of the time. In other words, if you have 10 stocks with this combination, the number of stocks that beat the consensus estimate could be as high as seven.
The Zacks Earnings ESP compares the Most Accurate Estimate to the Zacks Consensus Estimate for the quarter; the Most Accurate Estimate is a version of the Zacks Consensus whose definition is related to change. The idea here is that analysts revising their estimates right before an earnings release have the latest information, which could potentially be more accurate than what they and others contributing to the consensus had predicted earlier.
Lumentum currently has an Earnings ESP of +0.46%, which suggests that analysts have recently become bullish on the company's earnings prospects. This positive Earnings ESP when combined with the stock's Zacks Rank #2 (Buy) indicates that another beat is possibly around the corner. We expect the company's next earnings report to be released on August 11, 2026.
Investors should note, however, that a negative Earnings ESP reading is not indicative of an earnings miss, but a negative value does reduce the predictive power of this metric.
Many companies end up beating the consensus EPS estimate, but that may not be the sole basis for their stocks moving higher. On the other hand, some stocks may hold their ground even if they end up missing the consensus estimate.
Because of this, it's really important to check a company's Earnings ESP ahead of its quarterly release to increase the odds of success. Make sure to utilize our Earnings ESP Filter to uncover the best stocks to buy or sell before they've reported.
Andar Capital Management HK Ltd decreased its position in shares of Lumentum Holdings Inc. (NASDAQ:LITE – Free Report) by 6.2% during the 1st quarter, according to its most recent filing with the Securities and Exchange Commission (SEC). The firm owned 11,000 shares of the technology company’s stock after selling 733 shares during the period. Lumentum makes up 6.6% of Andar Capital Management HK Ltd’s holdings, making the stock its 8th biggest position. Andar Capital Management HK Ltd’s holdings in Lumentum were worth $7,730,000 at the end of the most recent quarter.
Several other hedge funds and other institutional investors have also bought and sold shares of the business. Advisors Asset Management Inc. grew its holdings in shares of Lumentum by 36.8% during the 1st quarter. Advisors Asset Management Inc. now owns 945 shares of the technology company’s stock worth $59,000 after purchasing an additional 254 shares in the last quarter. NewEdge Advisors LLC raised its holdings in shares of Lumentum by 109.9% during the 1st quarter. NewEdge Advisors LLC now owns 11,986 shares of the technology company’s stock worth $747,000 after buying an additional 6,275 shares in the last quarter. Empowered Funds LLC lifted its position in shares of Lumentum by 9.1% during the 1st quarter. Empowered Funds LLC now owns 8,139 shares of the technology company’s stock worth $507,000 after buying an additional 680 shares during the last quarter. Hsbc Holdings PLC acquired a new stake in Lumentum in the second quarter valued at about $298,000. Finally, Arrowstreet Capital Limited Partnership acquired a new stake in Lumentum in the second quarter valued at about $1,712,000. Institutional investors and hedge funds own 94.05% of the company’s stock.
Analyst Upgrades and Downgrades LITE has been the subject of several research reports. Mizuho set a $1,100.00 price objective on shares of Lumentum in a research note on Wednesday, May 6th. Rosenblatt Securities upped their price objective on Lumentum from $900.00 to $1,300.00 and gave the company a “buy” rating in a research note on Wednesday, May 6th. Morgan Stanley raised their price objective on shares of Lumentum from $710.00 to $900.00 and gave the company an “equal weight” rating in a report on Wednesday, May 6th. Craig Hallum lifted their target price on shares of Lumentum from $900.00 to $1,150.00 in a research report on Wednesday, May 6th. Finally, Citigroup reissued a “buy” rating on shares of Lumentum in a report on Thursday. Fourteen research analysts have rated the stock with a Buy rating and seven have issued a Hold rating to the stock. Based on data from MarketBeat, the stock has a consensus rating of “Moderate Buy” and an average price target of $1,012.67.
Get Our Latest Stock Analysis on LITE
Insider Buying and Selling at Lumentum In other news, Director Isaac Hosojiro Harris sold 1,416 shares of the firm’s stock in a transaction on Tuesday, June 2nd. The stock was sold at an average price of $1,000.08, for a total transaction of $1,416,113.28. Following the completion of the sale, the director directly owned 6,984 shares of the company’s stock, valued at $6,984,558.72. This trade represents a 16.86% decrease in their position. The sale was disclosed in a document filed with the SEC, which is available through the SEC website. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, CFO Wajid Ali sold 2,487 shares of Lumentum stock in a transaction on 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 sale, the chief financial officer owned 60,951 shares in the company, valued at $58,144,206.45. The trade was a 3.92% 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. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Insiders sold a total of 41,260 shares of company stock valued at $38,859,220 in the last ninety days. 0.43% of the stock is owned by corporate insiders.
Lumentum Stock Up 4.5% Shares of NASDAQ LITE opened at $765.55 on Tuesday. The company has a debt-to-equity ratio of 0.01, a current ratio of 1.14 and a quick ratio of 0.97. The company has a 50-day moving average price of $859.31 and a 200-day moving average price of $715.91. The stock has a market capitalization of $59.56 billion, a P/E ratio of 141.77 and a beta of 1.48. Lumentum Holdings Inc. has a 1 year low of $97.55 and a 1 year high of $1,085.68.
Lumentum (NASDAQ:LITE – Get Free Report) last posted its earnings results on Tuesday, May 5th. The technology company reported $2.37 earnings per share for the quarter, topping analysts’ consensus estimates of $2.27 by $0.10. The company had revenue of $808.40 million for the quarter, compared to analyst estimates of $810.21 million. Lumentum had a net margin of 17.61% and a return on equity of 24.81%. The firm’s revenue was up 90.1% compared to the same quarter last year. During the same quarter in the prior year, the business posted $0.57 EPS. Lumentum has set its Q4 2026 guidance at 2.850-3.050 EPS. On average, equities research analysts forecast that Lumentum Holdings Inc. will post 6.42 EPS for the current fiscal year.
About Lumentum (Free Report)
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.
Recommended Stories Five stocks we like better than Lumentum The Ugliest Stocks in the Market Just Got a Very Expensive Vote of Confidence Is Domino’s Stock Serving Up a Buying Opportunity? A $1T Black Hole: SpaceX Eyes Pentagon AI to Break Free Why Gold Miners Could Be the Market’s Biggest Comeback Story Want to see what other hedge funds are holding LITE? Visit HoldingsChannel.com to get the latest 13F filings and insider trades for Lumentum Holdings Inc. (NASDAQ:LITE – Free Report).
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Assetmark Inc. grew its stake in shares of Lumentum Holdings Inc. (NASDAQ:LITE – Free Report) by 21,974.6% during the 1st quarter, according to the company in its most recent 13F filing with the SEC. The institutional investor owned 13,907 shares of the technology company’s stock after buying an additional 13,844 shares during the quarter. Assetmark Inc.’s holdings in Lumentum were worth $9,773,000 at the end of the most recent quarter.
Other institutional investors and hedge funds have also recently made changes to their positions in the company. Nomura Asset Management Co. Ltd. lifted its stake in Lumentum by 45.0% in the fourth quarter. Nomura Asset Management Co. Ltd. now owns 369,804 shares of the technology company’s stock worth $136,306,000 after acquiring an additional 114,714 shares during the period. Andar Capital Management HK Ltd bought a new stake in Lumentum in the fourth quarter valued at $4,325,000. Whittier Trust Co. increased its position in Lumentum by 21,806.5% during the 1st quarter. Whittier Trust Co. now owns 74,044 shares of the technology company’s stock valued at $57,183,000 after purchasing an additional 73,706 shares during the period. Mirae Asset Global Investments Co. Ltd. purchased a new position in Lumentum during the 4th quarter valued at $6,755,000. Finally, Maxi Investments CY Ltd bought a new position in Lumentum in the 4th quarter worth $2,212,000. Hedge funds and other institutional investors own 94.05% of the company’s stock.
Insiders Place Their Bets In related news, insider Vincent Retort sold 3,183 shares of the firm’s stock in a transaction that occurred on Monday, May 18th. The shares were sold at an average price of $953.95, for a total transaction of $3,036,422.85. Following the completion of the sale, the insider owned 89,563 shares of the company’s stock, valued at $85,438,623.85. This trade represents a 3.43% decrease in their ownership of the stock. The sale was disclosed in a legal filing with the Securities & Exchange Commission, which is available at the SEC website. 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 Ian Small sold 4,954 shares of the business’s stock in a transaction that occurred on Thursday, May 21st. The stock was sold at an average price of $868.07, for a total transaction of $4,300,418.78. Following the completion of the transaction, the director owned 21,008 shares of the company’s stock, valued at approximately $18,236,414.56. The trade was a 19.08% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. In the last three months, insiders sold 41,260 shares of company stock valued at $38,859,220. 0.43% of the stock is owned by company insiders.
Lumentum Trading Up 4.5% NASDAQ LITE opened at $765.55 on Tuesday. Lumentum Holdings Inc. has a 12 month low of $97.55 and a 12 month high of $1,085.68. The company has a current ratio of 1.14, a quick ratio of 0.97 and a debt-to-equity ratio of 0.01. The stock’s fifty day moving average price is $859.31 and its 200-day moving average price is $715.91. The stock has a market cap of $59.56 billion, a P/E ratio of 141.77 and a beta of 1.48.
Lumentum (NASDAQ:LITE – Get Free Report) last posted its quarterly earnings results on Tuesday, May 5th. The technology company reported $2.37 earnings per share (EPS) for the quarter, topping the consensus estimate of $2.27 by $0.10. The firm had revenue of $808.40 million during the quarter, compared to analyst estimates of $810.21 million. Lumentum had a return on equity of 24.81% and a net margin of 17.61%.Lumentum’s quarterly revenue was up 90.1% compared to the same quarter last year. During the same quarter in the previous year, the firm earned $0.57 EPS. Lumentum has set its Q4 2026 guidance at 2.850-3.050 EPS. As a group, equities analysts forecast that Lumentum Holdings Inc. will post 6.42 EPS for the current fiscal year.
Wall Street Analysts Forecast Growth LITE has been the subject of several research analyst reports. Barclays raised their target price on shares of Lumentum from $750.00 to $1,000.00 and gave the stock an “equal weight” rating in a research report on Wednesday, May 6th. Weiss Ratings reissued a “hold (c)” rating on shares of Lumentum in a research note on Tuesday, April 21st. JPMorgan Chase & Co. raised their price objective on shares of Lumentum from $950.00 to $1,130.00 and gave the stock an “overweight” rating in a report on Wednesday, May 6th. Susquehanna lifted their price objective on Lumentum from $550.00 to $1,100.00 and gave the company a “positive” rating in a research report on Monday, April 20th. Finally, Loop Capital upped their target price on Lumentum from $900.00 to $1,400.00 and gave the stock a “buy” rating in a report on Tuesday, May 5th. Fourteen analysts have rated the stock with a Buy rating and seven have given a Hold rating to the stock. According to data from MarketBeat.com, Lumentum has a consensus rating of “Moderate Buy” and a consensus price target of $1,012.67.
View Our Latest Stock Report on LITE
Lumentum Profile (Free Report)
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.
Featured Articles Five stocks we like better than Lumentum The Ugliest Stocks in the Market Just Got a Very Expensive Vote of Confidence Is Domino’s Stock Serving Up a Buying Opportunity? A $1T Black Hole: SpaceX Eyes Pentagon AI to Break Free Why Gold Miners Could Be the Market’s Biggest Comeback Story Want to see what other hedge funds are holding LITE? Visit HoldingsChannel.com to get the latest 13F filings and insider trades for Lumentum Holdings Inc. (NASDAQ:LITE – Free Report).
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Baader Bank Aktiengesellschaft lessened its holdings in shares of Lumentum Holdings Inc. (NASDAQ:LITE – Free Report) by 16.0% during the 1st quarter, according to its most recent filing with the Securities and Exchange Commission (SEC). The fund owned 5,683 shares of the technology company’s stock after selling 1,086 shares during the quarter. Baader Bank Aktiengesellschaft’s holdings in Lumentum were worth $3,894,000 as of its most recent filing with the Securities and Exchange Commission (SEC).
A number of other hedge funds have also recently modified their holdings of LITE. Arrowstreet Capital Limited Partnership lifted its position in Lumentum by 18.7% during the fourth quarter. Arrowstreet Capital Limited Partnership now owns 1,854,801 shares of the technology company’s stock valued at $683,661,000 after purchasing an additional 291,591 shares in the last quarter. Geode Capital Management LLC increased its position in Lumentum by 9.6% in the fourth quarter. Geode Capital Management LLC now owns 1,412,213 shares of the technology company’s stock worth $521,563,000 after buying an additional 123,265 shares in the last quarter. Situational Awareness LP increased its position in Lumentum by 210.9% in the fourth 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 in the last quarter. Norges Bank bought a new position in shares of Lumentum in the fourth quarter worth about $474,495,000. Finally, Value Aligned Research Advisors LLC bought a new position in shares of Lumentum in the fourth quarter worth about $432,062,000. Institutional investors own 94.05% of the company’s stock.
Analyst Ratings Changes LITE has been the topic of several analyst reports. TD Cowen lowered their price target on shares of Lumentum from $995.00 to $800.00 and set a “hold” rating on the stock in a report on Monday, July 13th. Loop Capital increased their price objective on shares of Lumentum from $900.00 to $1,400.00 and gave the stock a “buy” rating in a research note on Tuesday, May 5th. Barclays raised their price objective on shares of Lumentum from $750.00 to $1,000.00 and gave the company an “equal weight” rating in a research report on Wednesday, May 6th. Northland Securities upped their target price on shares of Lumentum from $1,000.00 to $1,200.00 and gave the stock an “outperform” rating in a report on Wednesday, June 3rd. Finally, Jefferies Financial Group reaffirmed a “buy” rating and issued a $1,200.00 target price on shares of Lumentum in a 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. According to MarketBeat, the company has a consensus rating of “Moderate Buy” and an average target price of $1,012.67.
Read Our Latest Stock Report on Lumentum
Insider Activity at Lumentum In other Lumentum news, Director Brian Lillie sold 11,951 shares of the stock in a transaction on Monday, May 11th. The stock was sold at an average price of $981.64, for a total value of $11,731,579.64. Following the sale, the director owned 13,959 shares in the company, valued at $13,702,712.76. This trade represents a 46.13% decrease in their ownership of the stock. The transaction was disclosed in a document filed with the SEC, which is available at this hyperlink. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, Director Isaac Hosojiro Harris sold 4,000 shares of Lumentum stock in a transaction on Friday, May 29th. The stock was sold at an average price of $860.00, for a total value of $3,440,000.00. Following the sale, the director owned 8,400 shares of the company’s stock, valued at approximately $7,224,000. This trade represents a 32.26% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders have sold 41,260 shares of company stock worth $38,859,220 over the last quarter. 0.43% of the stock is owned by insiders.
Lumentum Stock Up 4.5% Shares of NASDAQ LITE opened at $765.55 on Tuesday. The company has a debt-to-equity ratio of 0.01, a current ratio of 1.14 and a quick ratio of 0.97. The company has a market cap of $59.56 billion, a P/E ratio of 141.77 and a beta of 1.48. Lumentum Holdings Inc. has a 1 year low of $97.55 and a 1 year high of $1,085.68. The firm has a 50-day simple moving average of $859.31 and a two-hundred day simple moving average of $715.91.
Lumentum (NASDAQ:LITE – Get Free Report) last announced its earnings results on Tuesday, May 5th. The technology company reported $2.37 earnings per share (EPS) for the quarter, beating the consensus estimate of $2.27 by $0.10. The business had revenue of $808.40 million during the quarter, compared to analyst estimates of $810.21 million. Lumentum had a return on equity of 24.81% and a net margin of 17.61%.The company’s revenue for the quarter was up 90.1% compared to the same quarter last year. During the same quarter in the previous year, the business earned $0.57 earnings per share. Lumentum has set its Q4 2026 guidance at 2.850-3.050 EPS. Research analysts anticipate that Lumentum Holdings Inc. will post 6.42 earnings per share for the current year.
Lumentum Company Profile (Free Report)
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.
Featured Articles Five stocks we like better than Lumentum The Ugliest Stocks in the Market Just Got a Very Expensive Vote of Confidence Is Domino’s Stock Serving Up a Buying Opportunity? A $1T Black Hole: SpaceX Eyes Pentagon AI to Break Free Why Gold Miners Could Be the Market’s Biggest Comeback Story Want to see what other hedge funds are holding LITE? Visit HoldingsChannel.com to get the latest 13F filings and insider trades for Lumentum Holdings Inc. (NASDAQ:LITE – Free Report).
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HomeIndustriesComputers/ElectronicsTech StocksTech StocksA Barclays analyst now recommends Lumentum’s stock after a period of substantial underperformance relative to the broader chip sectorJuly 20, 2026, 5:05 p.m. ET
Optical-networking stocks have come back down to earth in recent months, and a Barclays analyst thinks that Lumentum Holdings shares now look attractive in the wake of their selloff.
On Monday, Barclays’s Tom O’Malley upgraded shares of Lumentum to overweight from equal-weight as the company ramps up a number of opportunities in networking. He called optical components “the most interesting subsector” when evaluating a pullback in the broader semiconductor universe.
Americké akciové trhy dnes zdá se zastaví předchozí dvoudenní pokles, nálada ale zůstává opatrná a nejednotná. Investoři sledují především vývoj kolem konfliktu mezi USA a Íránem, kde americká armáda pokračovala devátou noc v útocích na íránské cíle s cílem chránit klíčové námořní trasy v okolí Hormuzského průlivu. Ropa během dne kolísala, ale její růst postupně vyprchal díky nadějím, že by se USA a Írán mohly vrátit k jednání o mírové dohodě. Riziková aktiva podpořil zejména návrat kupců do polovodičů po předchozích výprodejích, zatímco širší trh byl slabší — většina titulů v S&P 500 klesá. Tento týden zároveň začíná důležitá část výsledkové sezóny, když reportovat budou mimo jiné Alphabet, Tesla, General Motors a AMD. Trh bude u velkých technologických firem sledovat hlavně to, zda dokážou obhájit masivní výdaje na AI infrastrukturu.
Sektorově je nejvýraznější pohyb patrný u polovodičů, kde index velkých výrobců čipů v čele s Nvidií a Broadcomem roste o 2 % a pomáhá držet trh nad vodou. Oživení přichází poté, co se Philadelphia Semiconductor Index v minulém týdnu propadl do medvědího trhu nicméně část stratégů tento pokles označuje spíše za dočasný reset než začátek dlouhodobějšího ústupu od AI tématu. Na druhé straně zůstává patrná rotace investorů mimo nejvíce přeplněné technologické obchody směrem k cyklickým a hodnotovým segmentům trhu. Výnos desetiletého amerického dluhopisu roste o 5 bazických bodů na 4,60 %. Euro oslabuje o 0,2 % na 1,1415 USD. WTI roste jen o 0,1 % na 82,61 USD za barel, zlato mírně ztrácí 0,1 % na 4 011,52 USD za unci, zatímco kryptoměny posilují — bitcoin o 1,5 % na 65 436 USD a ether o 1,7 % na 1 898 USD.
Z jednotlivých titulů se do popředí dostal Alphabet (GOOG +2,02 %), který roste po zprávě, že Google vyvíjí čip zaměřený na zvýšení efektivity umělé inteligence. Boeing (BA -1,61 %) oznámil téměř 150 objednávek na úvod leteckého veletrhu Farnborough, což podpořilo vnímání silné poptávky v leteckém průmyslu, nicméně akcie klesají. AMC Entertainment (AMC +25 %) prudce roste po zveřejnění tržeb za druhé čtvrtletí, které překonaly průměrný odhad analytiků. Domino’s Pizza (DPZ +1,67 %) kosmeticky roste poté co růst srovnatelných tržeb v USA zpomalil na nejnižší tempo za pět čtvrtletí, což naznačuje opatrnější chování spotřebitelů v segmentu stravování mimo domov. Trh sleduje i plánované IPO Jersey Mike’s Subs, v němž firma a její akcionáři chtějí získat až 1,09 mld. USD, což zapadá do širšího oživení amerického trhu primárních emisí.
Index Dow Jones -0,3 % na 51988,06 b.
S&P 500 +0,21 % na 7473,25 b.
Nasdaq Composite +0,52 % na 25651,82 b.
Index S&P 500 +0,21 % na 7473,25 b. Nejsilnější sektory S&P Změna Nejslabší sektory S&P Změna Energie +1,1 % Základní materiály -0,8 % Komunikační služby +1 % Nezbytná spotřeba -0,7 % Informační technologie +0,7 % Zdravotní péče -0,6 % Nejsilnější akcie S&P Změna Nejslabší akcie S&P Změna Lumentum Holdings (LITE) +6,5 % Honeywell Aerospace (HONA) -4,8 % Global Payments (GPN) +5,9 % Carvana (CVNA) -3,9 % Sandisk Corp (SNDK) +5,8 % Warner Bros Discovery (WBD) -3,8 % Coherent Corp (COHR) +5,4 % KKR (KKR) -3,5 % Teradyne (TER) +5,1 % Chipotle Mexican Grill (CMG) -3,5 %
Martin Varecha
Fio banka, a.s.
Prohlášení
SummaryLumentum's 15% pullback followed the Russell index removal and sector-wide profit-taking rather than deteriorating AI optics demand or fundamentals.Concerns over co-packaged optics timing compressed valuations, but Nvidia's optical roadmap continues supporting long-term photonics adoption and demand.Consensus expects revenue to grow from $3.0 billion in FY2026 to $11.6 billion by FY2029, making execution increasingly critical.Despite trading around 19x forward sales, the recent correction improves the risk/reward profile, supporting a renewed Strong Buy rating. panumas nikomkai/iStock via Getty Images
The recent pullback in Lumentum Holdings Inc. (LITE) has enhanced the risk/reward profile without fundamentally changing the story on the AI optics front. The demand for applications in hyperscale networking, optical circuit switching, and next-generation photonics continues to be very high, while
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Analyst’s Disclosure: I/we have a beneficial long position in the shares of LITE, COHR either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.
Pre-Market Stock Futures: Futures are trading higher as we get ready to start another action-packed week of second-quarter earnings results. This comes after a volatile week of trading and a Friday close that saw all major indices finish lower. Ongoing rotation out of semiconductor stocks, worries over an escalation of the war with Iran, a rekindling of inflation concerns, and the possibility of an interest rate increase at some point this year all weighed on investors. When the final bell rang, the Nasdaq once again was the big loser, closing down 1.40% at 25,520, while the S&P 500 finished the week lower by 1.01% on Friday at 7,457. The Dow Jones Industrial closed at 52,146, down 0.77% on the day, while the small-cap Russell 2000 closed at 2,962, down 0.42%.
Treasury Bonds: Yields were mixed across the Treasury curve on Friday, with buyers targeting the belly and long-end, while sellers sold off the shorter maturities. The 30-year-long bond finished the session at 5.07%, while the benchmark 10-year note closed at 4.55%. Traders cited the tech sell-off, geopolitical worries, and the strong June import prices report as factors on Friday.
Oil and Gas: The song remains the same for the energy complex, as buyers once again bid up the prices of the two oil benchmarks. Concerns over supply disruption as the war escalates, drone strikes on regional infrastructure suspending crude loadings at Iraq’s Basra terminal, and the increase in the geopolitical premium are all among the tailwinds for the buyers on Friday. When the final bell rang, Brent Crude finished the day at $88.12, up 4.62%, while West Texas Intermediate was last seen at $82.47, higher by 4.46%. Natural gas closed Friday at $2.92, up 2.20%.
Gold: After a very difficult week for the precious metals complex, investors received a strong finish on Friday. Traders cited softer consumer sentiment readings and a weaker dollar as reasons for the uptick. Gold closed trading at $4,017, up 1.05%, while Silver ended the day at $55.84, up 0.78%.
Crypto: Crypto markets slid on Friday amid the broad risk-off sentiment, as a sharp sell-off in global semiconductor stocks spilled over into digital assets and was further fueled by rising U.S.-Iran tensions. Bitcoin dropped 1.2%, slipping below $63,000, while Ethereum led major coin losses, falling roughly 4% to around $1,850. The downturn triggered nearly $400 million in crypto liquidations over the past 24 hours, with long positions bearing the brunt of the pain. At 8 AM EDT, Bitcoin traded at $64,817, while Ethereum traded at $1,890.
24/7 Wall St. reviews dozens of analyst research reports every day to identify fresh investment ideas for investors and traders alike. These daily analyst notes include recommendations on stocks to buy, sell, or avoid, as well as new coverage initiations. Important reminder: No single analyst report should ever be the sole basis for buying or selling a stock.
Here are some of the top Wall Street analyst upgrades, downgrades, and initiations seen on Monday, July 20, 2026.
Upgrades: Fervo Energy (NASDAQ: FRVO) was upgraded to Buy from Hold at Jefferies, which trimmed the target price for the stock to $36 from $41. This company was a recent IPO. Lumentum Holdings (NASDAQ: LITE) | LITE Price Prediction was upgraded to Overweight from Equal Weight at Barclays, with a $1,000 target price objective. Netflix (NASDAQ: NFLX) was upgraded to Buy from Accumulate at Phillip Securities, with a $110 target price. Urban Outfitters (NASDAQ: URBN) was raised to Buy from Neutral at Goldman Sachs, which raised the target price to $93 from $76. Yeti Holdings (NYSE: YETI) was upgraded to Buy from Neutral at Goldman Sachs, which lifted the target price for the shares to $63 from $46. Downgrades: Birkenstock Holdings (NYSE: BIRK) was downgraded to Neutral from Buy at Seaport Research, without a target price. Charles Schwab (NYSE: SCHW) was downgraded to Market Perform from Outperform at BMO Capital, with an unchanged $105 target price. HubSpot (NYSE: HUBS) was downgraded to Equal Weight from Overweight at Wells Fargo, which slashed the target price for the stock to $225 from $300. Monster Beverage (NASDAQ: MNST) was cut to Hold from Buy at Deutsche Bank, which bumped the price target for the energy drink giant to $98 from $94. Truist Financial (NYSE: TFC) was downgraded to Underweight from Neutral at JPMorgan, which trimmed the target price for the shares to $53 from $53.50. Initiations: BP (NYSE: BP) was started with an Outperform rating at Mizuho, with a $51 target price. Honeywell Aerospace (NASDAQ: HONA) was initiated with a Neutral rating at UBS, with a $231 target price for the shares. Microsoft Corporation (NASDAQ: MSFT) was initiated with an Outperform rating at CLSA, with a $535 target price.
Oracle (NYSE: ORCL) was started with a Hold rating at CLSA, with a $145 target price. ServiceNow (NYSE: NOW) was initiated with an Underperform rating at CLSA, with a $72 target price. Act now: the analyst who called NVIDIA in 2010 just named his top 10 AI stocks — and Netflix didn't make the cut. Grab the names FREE today.
Americké akciové indexy v závěru páteční seance ještě mírně prohloubily předchozí ztráty a uzavřely unisono se zápornou bilancí. Nejhůře si stál technologický Nasdaq, který odepsal 1,4 %, širší index S&P500 pak 1,01 % a Dow Jones -0,77 %.
Všechny segmenty S&P500 vyjma energií (+1,2 %) uzavřely v červených číslech. Se ziskem naopak končily drahé kovy. Zlato přidalo 1 % a uzavřelo na 4010 USD/oz, stříbro zpevnilo o 0,7 % na 55,9 USD/oz. Mírný růst vykázaly také dluhopisy vyjma nejkratších splatností. Výnos 10letého vládního bondu se usadil na 4,555 % (vs. 4,57 % včera). Pěkné zisky vykázaly energie. Ropa na pozadí rostoucích tenzí na Blízkém východě posílila o 4,4 % na 82,4 USD/barel, zemní plyn zpevnil o 2,3 % na 2,93 USD/mmbtu.
Závěrečné hodnoty:
Dow Jones -0,77 % na 52146,42 b.
S&P 500 -1,01 % na 7457,69 b.
Nasdaq Composite -1,4 % na 25520,24 b.
Index S&P 500 -1,01 % na 7457,69 b. Nejsilnější sektory S&P Změna Nejslabší sektory S&P Změna Energie +1,2 % Komunikační služby -2,4 % Reality 0 % Zbytná spotřeba -1,6 % Průmysl -0,4 % Informační technologie -1,1 % Nejsilnější akcie S&P Změna Nejslabší akcie S&P Změna Travelers Cos (TRV) +9,2 % Intuitive Surgical (ISRG) -14 % Seagate Technology Holdings (STX) +5,7 % Cadence Design Systems (CDNS) -9,5 % Centene Corp (CNC) +4,0 % Synopsys (SNPS) -7,9 % Casey's General Stores (CASY) +3,9 % Netflix (NFLX) -7,3 % Lumentum Holdings (LITE) +3,8 % Axon Enterprise (AXON) -5,8 %
David Lamač
Fio banka, a.s.
Prohlášení
Key Takeaways Lumentum's 200G EML revenues more than doubled sequentially as total laser-chip shipments doubled YoY.EML unit volumes are expected to grow over 50% by December 2026, supported by expanded InP fab capacity.CPO laser chips could generate meaningful revenues by late 2026, backed by a major purchase order. Lumentum Holdings (LITE - Free Report) is well positioned to accelerate revenue growth as surging AI infrastructure investments drive record demand for its laser chips, a critical building block of high-speed optical networking. In third-quarter fiscal 2026, the company delivered record EML (electro-absorption modulated laser) shipments, with 200G EML revenues more than doubling sequentially and total laser chip shipments doubling year over year. Management also expects EML unit volumes to grow more than 50% by the December 2026 quarter, underscoring strong customer demand.
The opportunity extends beyond shipment growth. Lumentum's laser chips are increasingly powering 800G and upcoming 1.6T optical transceivers, while internal deployment of its continuous-wave (CW) lasers enhances vertical integration and captures more value across the optical networking stack. Meanwhile, with the production capacity of its wafer fab in Japan fully allocated, the company has acquired a fifth Indium Phosphide (InP) fab to expand production capacity and meet the demand for future growth.
Lumentum's next growth wave could come from co-packaged optics (CPO), where ultra-high-power laser chips are on track for meaningful revenue generation by late 2026, supported by a multi-hundred-million-dollar purchase order and collaborations with multiple customers.
Strong forward guidance further supports the continued growth of laser chips. Lumentum expects fourth-quarter fiscal 2026 revenues in the range of $960 million to $1.01 billion, up sequentially, reflecting sustained demand. The company also projects non-GAAP operating margins of 35%-36%, suggesting that higher laser chip shipments and a richer product mix should continue driving both revenue growth and profitability.
How Lumentum Stacks Up to CompetitorsLumentum competes directly with Applied Optoelectronics, Inc. (AAOI - Free Report) in AI optical networking as both target hyperscale AI deployments with high-speed transceivers and laser technologies. Applied Optoelectronics emphasizes vertically integrated laser manufacturing, rapid 800G/1.6T capacity expansion and CPO-ready external laser sources. Applied Optoelectronics expects AI demand to exceed production through 2027, while Lumentum counters with broader laser-chip, optical switching and scale-across photonics leadership.
On the other hand, Broadcom Inc. (AVGO - Free Report) competes with Lumentum across AI optical networking, photonics and co-packaged optics for hyperscale AI clusters. Broadcom combines Ethernet switching, DSPs, EML lasers and CPO leadership with deep hyperscaler partnerships and massive AI infrastructure investments. Broadcom benefits from unmatched networking scale, while Broadcom faces Lumentum's strengths in laser chips, optical components and scale-out/scale-across photonic systems.
LITE’s Share Price Performance, Valuation & EstimatesShares of Lumentum have surged 117.5% in the past six months, outperforming the broader Zacks Computer and Technology sector’s growth of 12.1%.
LITE’s 6-Month Price Performance
Image Source: Zacks Investment Research
From a valuation standpoint, LITE trades at a forward price-to-earnings ratio of 38.62, above the industry’s average of 37.2. LITE carries a Value Score of D.
LITE’s Valuation
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for Lumentum’s fiscal 2027 earnings is pegged at $18.07 per share, implying a year-over-year increase of 121.15%. The EPS estimates for fiscal 2027 have risen in the past 60 days.
Image Source: Zacks Investment Research
Lumentum stock carries a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Lumentum (LITE - Free Report) could be a solid addition to your portfolio given its recent upgrade to a Zacks Rank #2 (Buy). This upgrade is essentially a reflection of an upward trend in earnings estimates -- one of the most powerful forces impacting stock prices.
The sole determinant of the Zacks rating is a company's changing earnings picture. The Zacks Consensus Estimate -- the consensus of EPS estimates from the sell-side analysts covering the stock -- for the current and following years is tracked by the system.
The power of a changing earnings picture in determining near-term stock price movements makes the Zacks rating system highly useful for individual investors, since it can be difficult to make decisions based on rating upgrades by Wall Street analysts. These are mostly driven by subjective factors that are hard to see and measure in real time.
As such, the Zacks rating upgrade for Lumentum is essentially a positive comment on its earnings outlook that could have a favorable impact on its stock price.
Most Powerful Force Impacting Stock PricesThe change in a company's future earnings potential, as reflected in earnings estimate revisions, and the near-term price movement of its stock are proven to be strongly correlated. That's partly because of the influence of institutional investors that use earnings and earnings estimates for calculating the fair value of a company's shares. An increase or decrease in earnings estimates in their valuation models simply results in higher or lower fair value for a stock, and institutional investors typically buy or sell it. Their bulk investment action then leads to price movement for the stock.
Fundamentally speaking, rising earnings estimates and the consequent rating upgrade for Lumentum imply an improvement in the company's underlying business. Investors should show their appreciation for this improving business trend by pushing the stock higher.
Harnessing the Power of Earnings Estimate RevisionsEmpirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock movements, so it could be truly rewarding if such revisions are tracked for making an investment decision. Here is where the tried-and-tested Zacks Rank stock-rating system plays an important role, as it effectively harnesses the power of earnings estimate revisions.
The Zacks Rank stock-rating system, which uses four factors related to earnings estimates to classify stocks into five groups, ranging from Zacks Rank #1 (Strong Buy) to Zacks Rank #5 (Strong Sell), has an impressive externally-audited track record, with Zacks Rank #1 stocks generating an average annual return of +25% since 1988. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here >>>> .
Earnings Estimate Revisions for LumentumThis optical networking products maker is expected to earn $8.17 per share for the fiscal year ending June 2026, which represents no year-over-year change.
Analysts have been steadily raising their estimates for Lumentum. Over the past three months, the Zacks Consensus Estimate for the company has increased 18.4%.
Bottom LineUnlike the overly optimistic Wall Street analysts whose rating systems tend to be weighted toward favorable recommendations, the Zacks rating system maintains an equal proportion of "buy" and "sell" ratings for its entire universe of more than 4,000 stocks at any point in time. Irrespective of market conditions, only the top 5% of the Zacks-covered stocks get a "Strong Buy" rating and the next 15% get a "Buy" rating. So, the placement of a stock in the top 20% of the Zacks-covered stocks indicates its superior earnings estimate revision feature, making it a solid candidate for producing market-beating returns in the near term.
You can learn more about the Zacks Rank here >>>
The upgrade of Lumentum to a Zacks Rank #2 positions it in the top 20% of the Zacks-covered stocks in terms of estimate revisions, implying that the stock might move higher in the near term.
Lumentum Holdings Inc. ("Lumentum") today announced that it will release its fiscal fourth quarter and full year 2026 financial results on Tuesday, August 11, 2
Artificial intelligence spending is entering a new phase. For the past three years, investors focused almost exclusively on GPUs because they powered every major AI breakthrough. That story isn’t over, but another bottleneck is emerging.
Moving data between thousands of processors is becoming just as important as the processors themselves. Goldman Sachs argues that networking — not computing — is the next major investment cycle in AI infrastructure. If that thesis proves correct, companies supplying the optical components that move data at light speed could enjoy years of demand growth.
Among them, Lumentum Holdings (NASDAQ:LITE | LITE Price Prediction) stands out as one of the purest and potentially highest-upside opportunities.
AI Needs Faster Highways, Not Just Faster Cars In its April 2026 optical networking report, Goldman Sachs argues that AI clusters are rapidly outgrowing traditional electrical connections. As Nvidia (NASDAQ:NVDA) transitions from Blackwell to Vera Rubin and eventually Rubin Ultra systems, networking content per computing unit is projected to expand from roughly $315,000 in today’s GB300 NVL72 architecture to approximately $9.4 million in Rubin Ultra NVL576 systems.
That represents a nearly 29-fold increase in networking value per computing unit.
Even more striking, Goldman estimates the overall addressable market for AI networking will grow from roughly $15 billion during the GB300 cycle to approximately $154 billion by 2028. Optical technologies – including pluggable transceivers and co-packaged optics (CPO) — become the biggest beneficiaries because copper connections increasingly struggle with higher bandwidths, longer distances, and rising power consumption.
To put that into perspective, Goldman projects the market for pluggable optical modules alone could increase about 10-fold, while the broader optical components market expands roughly 13-fold as optics migrate beyond traditional rack-to-rack networking into shorter-reach connections inside AI systems themselves.
Lumentum already supplies lasers, optical engines, and photonic components used in high-speed data center transceivers. Those products become increasingly valuable as hyperscalers upgrade from 800G networking to 1.6-terabit and eventually 3.2-terabit optical connections.
Goldman also expects co-packaged optics to account for roughly $91 billion, or 59%, of total AI networking spending under its base-case 2028 scenario. While widespread CPO adoption still carries execution risk, Lumentum participates in both today’s dominant pluggable market and tomorrow’s emerging optical engine market.
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That gives investors exposure regardless of whether the industry moves gradually or rapidly toward CPO.
Compared with diversified semiconductor companies like Broadcom (NASDAQ:AVGO) or Marvell Technology (NASDAQ:MRVL), Lumentum offers much greater sensitivity to rising optical demand because communications hardware accounts for such a large share of its business. If AI networking spending accelerates anywhere near Goldman’s projections, Lumentum’s revenue growth could outpace that of larger, more diversified peers.
Risks Remain, but the Tailwinds Are Powerful Granted, Goldman acknowledges its assumptions are optimistic. The report assumes approximately 29% CPO penetration by Rubin Ultra’s rollout, while several independent industry forecasts envision slower adoption extending toward 2030. Manufacturing complexity, packaging yields, serviceability concerns, and hyperscaler qualification timelines could all delay deployment.
There’s also the broader AI spending question. Goldman bases its projections on continued aggressive hyperscale investment. If capital expenditures slow or AI infrastructure spending becomes more disciplined, networking demand would likely moderate as well.
That said, the broader trend appears difficult to dismiss. Every major AI roadmap from Nvidia points toward larger clusters, faster interconnects, and greater optical content. Even if CPO adoption slips, Goldman still expects pluggable optics to experience substantial volume growth.
Key Takeaway In short, Goldman Sachs isn’t suggesting GPUs are becoming less important. Instead, it is arguing that networking is becoming equally essential because AI systems cannot scale if data cannot move quickly enough between processors.
For investors, that creates an opportunity beyond the familiar AI leaders. Lumentum may not be the safest AI investment — that would likely be Nvidia — but it could be one of the most leveraged to the optical networking buildout Goldman forecasts. If AI networking spending expands from $15 billion to $154 billion over the next several years, few companies offer as direct an investment on that secular trend.
The risks are real, particularly around CPO adoption timing, but the potential reward is equally compelling for investors willing to accept the volatility.
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Lumentum Holdings Inc. is well-positioned to benefit from industry-wide upgrades to higher data transmission speeds, driving robust EML demand. The optical devices market remains tight through at least 2028, supporting 15-20% ASP increases and gross margin expansion for LITE. LITE is at a critical inflection point toward positive free cash flow, with >30% FCF margins expected by FY28 mitigating higher interest rate risks.
Lumentum Holdings Inc. (NASDAQ:LITE) stock is trading higher on Thursday. The California-based technology firm is experiencing upward momentum alongside other companies in the fiber optic connectivity sector.
The Nasdaq is up 1.55% while the S&P 500 has gained 0.72%.
• Lumentum Holdings stock is surging to new heights today. Why are LITE shares rallying?
Sector Catalysts Boost Demand OutlookMeta declined to comment on the development following a Benzinga inquiry.
Infrastructure Expansions Signal Sustained AppetiteDecreasing Short Interest Supports UpsideMarket data indicates that short interest in Lumentum decreased during the latest reporting period, dropping from 10.22 million to 9.29 million shares. This short interest accounts for 13.22% of the company’s publicly available float. Based on an average daily trading volume of 6.21 million shares, short sellers would require 1.5 days to cover their positions.
LITE Stock: Key Levels and Momentum IndicatorsEven after today’s jump, Lumentum is still trading 5.3% below its 20-day SMA and 11.3% below its 50-day SMA, which keeps the near-term trend in "repair mode" despite the strong session. At the same time, the stock remains 42.1% above its 200-day SMA, so the longer-term uptrend is still intact even with recent volatility. RSI is the cleaner momentum read right now: at 46.23.
The moving-average structure is mixed, with the 20-day SMA below the 50-day SMA (a bearish near-term alignment) even as the 50-day SMA remains above the 200-day SMA (a bullish longer-term backdrop). That combination often produces sharp countertrend rallies that still need follow-through to flip the short-term trend back up.
Key Resistance: $809 — Nearby round-number area that also sits close to the 100-day SMA zone, where rebounds can stall. Key Support: $776 — Nearby pivot area just above the 100-day EMA, where buyers may try to defend the recent base. LITE Stock Price Activity: Lumentum stock was up 12.33% at $794.30 at the time of publication on Thursday, according to Benzinga Pro data.
Photo: Piotr Swat on Shutterstock.com
This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
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Ke konci obchodní seance se mírně přelil kapitál z čipových společností do klasických technologických. Přesto společnosti jako AMD + 5,67 %, Micron +4,39 %, či Broadcom +3,2 % končí výrazně v zeleném a čipový sektor táhl celý trh. Společnosti SpaceX se podařilo dostat opět nad otevírací cenu po IPO a přidala dnes +2,65 %.
Sektor spotřebního zboží dnes táhly dolů akcie PepsiCo, která po ne příliš oslnivých výsledcích odepsala nakonec -3,26 %. V kladných hodnotách se udržely i kryptoměny, kdy Bitcoin přidal +1,8 %.
Na opačné straně stála cena ropy, kde WTI propadl o -2,22 %, a to z důvodu mírného uklidnění situace v Íránu.
Index Dow Jones +0,27 % na 52487,38 b.
S&P 500 +0,81 % na 7543,54 b.
Nasdaq Composite +1,3 % na 26206,89 b.
Index S&P 500 +0,81 % na 7543,54 b. Nejsilnější sektory S&P Změna Nejslabší sektory S&P Změna Informační technologie +1,6 % Nezbytná spotřeba -1,8 % Zbytná spotřeba +1,5 % Energie -1,6 % Finanční sektor +1 % Utility -0,5 % Nejsilnější akcie S&P Změna Nejslabší akcie S&P Změna Lumentum Holdings (LITE) +11 % APA Corp (APA) -5,1 % Hewlett Packard Enterprise (HPE) +9,9 % Paramount Skydance Corp (PSKY) -4,3 % Fedex Freight Holding (FDXF) +7,6 % Costco Wholesale Corp (COST) -4,2 % Sandisk Corp (SNDK) +7,6 % Cincinnati Financial Corp (CINF) -3,4 % Norwegian Cruise Line Holdings (NCLH) +7,0 % PepsiCo (PEP) -3,3 %
Jan Pazourek, Fio banka, a.s.
Key Takeaways Lumentum is expanding CPO as a potential long-term growth driver for AI infrastructure.LITE is scaling ultra-high-power laser chips, with production progressing on schedule.Lumentum's AI portfolio includes pump lasers, EML chips, cloud transceivers and OCS. Lumentum Holdings (LITE - Free Report) is expanding its co-packaged optics (CPO) portfolio, positioning the technology as a potential long-term growth driver as AI infrastructure investments accelerate. The company expects CPO, alongside Optical Circuit Switches (OCS), to contribute incremental revenues as commercial deployments ramp, supporting both revenue and earnings growth.
The company is scaling production of ultra-high-power laser chips specifically designed for CPO applications, with manufacturing progressing on schedule and commercial contributions expected to increase as deployments expand. These investments build on Lumentum's leadership in optical components, allowing it to leverage its expertise in semiconductor lasers and photonic technologies rather than entering an entirely new market.
Beyond CPO, the strategy complements Lumentum's broader AI networking portfolio, including pump lasers, narrow-linewidth laser assemblies, EML laser chips, cloud transceivers and OCS, strengthening its position across multiple layers of next-generation AI data-center infrastructure.
The opportunity is supported by structural industry trends. As hyperscale AI clusters become larger and more power-intensive, traditional electrical interconnects face bandwidth and energy-efficiency limitations, increasing the need for optical technologies such as CPO. Lumentum's ongoing investments in manufacturing capacity and high-performance laser technologies position it to benefit as customers transition toward these advanced architectures.
If adoption accelerates as expected, CPO could emerge as another significant growth engine alongside Lumentum's fast-growing AI networking business, supporting the company's robust growth outlook. The Zacks Consensus Estimate projects revenues to increase 81.9% in fiscal 2026 and 86.4% in fiscal 2027 year over year.
Lumentum's Rivals in Co-Packaged OpticsMarvell Technology (MRVL - Free Report) competes with Lumentum through its broad silicon photonics platform, supporting both CPO and NPO architectures. MRVL leverages partnerships, Tier 1 hyperscaler engagements and multiple photonic technologies to capture scale-up networking opportunities. While Lumentum focuses on laser chips and CPO modules, MRVL distinguishes itself through integrated interconnect, switching, and custom silicon capabilities, thereby strengthening its position in AI infrastructure.
Broadcom Inc. (AVGO - Free Report) rivals Lumentum by combining CPO with Ethernet switching, DSPs, CW and EML lasers, offering an end-to-end AI networking platform. AVGO positions its CPO portfolio as the industry standard while benefiting from leadership in networking silicon and hyperscaler relationships. Compared with Lumentum's laser-focused strategy, AVGO gains scale through tightly integrated semiconductor and networking solutions. It continues expanding this advantage.
LITE’s Share Price Performance, Valuation & EstimatesShares of Lumentum have skyrocketed 700% over the past year, outperforming the Zacks Communication - Components industry’s appreciation of 304.8% and the broader Computer and Technology sector’s growth of 35%.
LITE’s One-Year Price Performance
Image Source: Zacks Investment Research
From a valuation standpoint, LITE trades at a forward price-to-earnings ratio of 40.61, below the industry’s average of 44.03. LITE carries a Value Score of F.
LITE’s Valuation
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for Lumentum’s fiscal 2027 earnings is pegged at $17.81 per share, suggesting robust year-over-year growth of approximately 118.77%. Notably, earnings estimates have moved higher over the past 30 and 60 days, reflecting improving analyst confidence in the company's growth outlook.
Image Source: Zacks Investment Research
Lumentum stock sports a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Key Takeaways Lumentum shares soared 700% in a year, far outpacing its industry and key optical peers.AI and cloud demand is driving optical connectivity, Components momentum, CPO and OCS growth.Strong cash, rising estimates and premium valuation support LITE as a growth-oriented buy. Lumentum Holdings’ (LITE - Free Report) shares have delivered extraordinary gains over the past year, soaring 700%, far outpacing the industry's 304.8% rally and the broader Zacks Computer and Technology sector's 35% growth.
Lumentum's gains have also significantly exceeded those of key industry peers, including Ciena (CIEN - Free Report) , Corning (GLW - Free Report) and Viavi Solutions (VIAV - Free Report) . The industry's strong momentum has been mirrored in stellar stock performance, with Ciena, Corning and Viavi Solutions gaining 452.8%, 270.1% and 312.2%, respectively, over the same period.
The remarkable growth has been driven by surging AI and cloud infrastructure demand, which has accelerated the adoption of its optical connectivity solutions. The company is also benefiting from exceptional momentum in its Components business, supported by strong demand for AI networking products. Investor confidence has further strengthened as Lumentum expands its portfolio of next-generation optical networking technologies, including Co-Packaged Optics (CPO) and Optical Circuit Switches (OCS), which are expected to become important long-term growth drivers.
LITE’s One-Year Price Performance
Image Source: Zacks Investment Research
Following such an exceptional run, investors might be wondering whether the stock remains an attractive investment or if the optimism surrounding its prospects is already priced in. Let's examine Lumentum’s fundamentals, growth prospects and valuation.
LITE Benefits From Strong AI and Cloud Infrastructure DemandLumentum is benefiting from the rapid expansion of AI and cloud infrastructure, as hyperscalers continue investing heavily in next-generation optical networking to support increasingly complex AI workloads. Demand remains broad across transceivers, EML laser chips and data center interconnect (DCI) components, while shipments of narrow-linewidth laser assemblies grew for the ninth consecutive quarter and pump laser shipments increased 80% year over year in the third quarter of fiscal 2026.
As hyperscalers build larger AI clusters, they are increasingly adopting distributed "scale-across" architectures that require high-bandwidth optical interconnects between data centers, creating a long runway for Lumentum's pump lasers, wavelength-selective switches (WSS) and precision laser technologies.
The long-term opportunity extends well beyond current demand. Lumentum is ramping 1.6T transceivers, expanding ultra-high-power laser production for co-packaged optics (CPO) and advancing optical circuit switching (OCS), supported by a multi-year, multi-billion-dollar purchase agreement. Several AI-focused products remain supply-constrained and effectively sold out, highlighting demand that exceeds current manufacturing capacity. Management also emphasized that scale-up CPO — its largest long-term growth driver — is still in its early stages, while cloud modules, EML lasers and scale-across products continue to gain momentum. These factors position Lumentum to benefit from sustained AI infrastructure spending and support continued revenue growth, margin expansion and long-term earnings potential.
LITE's Financial Strength Supports Long-Term GrowthLumentum's strong financial position provides the flexibility to continue investing for long-term growth while capitalizing on the expanding opportunities in AI and cloud infrastructure. At the end of the third quarter of fiscal 2026, the company held $3.17 billion in cash, cash equivalents and short-term investments, an increase of more than $2 billion sequentially, primarily driven by the issuance of Series A Convertible Preferred Stock. The strengthened balance sheet equips Lumentum to fund capacity expansion, support strategic investments and maintain the manufacturing scale needed to meet rising demand for AI networking products.
The company's financial strength is accompanied by improving operating performance and disciplined execution. Operating cash flow surged to $388.4 million during the first nine months of fiscal 2026, while record revenues, favorable product mix and higher manufacturing utilization drove meaningful gross and operating margin expansion. Management also continues to invest in critical research and development programs serving cloud and AI customers without compromising cost discipline, demonstrating the scalability of its business model.
Driven by ample liquidity, rising profits and sustained investment in cutting-edge technologies — such as co-packaged optics (CPO), optical circuit switching (OCS) and high-speed optical components — Lumentum is well-positioned to execute its long-term growth strategy and capitalize on ongoing investment opportunities within the artificial intelligence (AI) infrastructure sector.
LITE’s Healthy Capital ReturnsLumentum demonstrates strong profitability, as reflected by its trailing 12-month return on equity (ROE) of 36.22%, well above the industry average of 19.12%. A higher ROE indicates the company's ability to generate greater profits by efficiently utilizing shareholders' capital.
Image Source: Zacks Investment Research
LITE’s Strong Top- & Bottom-Line ProspectsThe Zacks Consensus Estimate for the company’s fiscal first quarter 2027 revenues is pegged at $1.13 billion, indicating a robust 112.3% year-over-year increase. For fiscal 2027, the top line is anticipated to rise 86.4% year over year.
On the earnings front, the consensus estimate for fiscal first-quarter 2027 is pegged at $3.46 per share, reflecting a substantial 214.5% year-over-year increase, while fiscal 2027 earnings are expected to surge 118.7%.
Notably, analysts have raised their earnings estimates for both the fiscal first quarter and full-year fiscal 2027 over the past 60 days. These upward estimate revisions underscore growing confidence in Lumentum's strong business model, expanding AI-driven growth opportunities and its ability to deliver sustained financial performance.
LITE Deserves a Premium for Its Growth ProspectsThe company’s strong exposure to rapidly growing AI infrastructure markets, expanding demand for optical networking products and leadership in co-packaged optics (CPO), laser chips and cloud photonics technologies justify a premium valuation, as suggested by a Value Score of F.
Lumentum is currently trading at a forward 12-month price-to-sales (P/S) ratio of 10.1X, well above both the broader technology sector and its industry peers. By comparison, the sector trades at 6.88X, while Ciena, Corning and Viavi Solutions trade at 8.35X, 8.32X and 5.47X, respectively.
Price/Sales Ratio (F12M)
Image Source: Zacks Investment Research
LITE Stock: A Strong Buy for GrowthGiven Lumentum's impressive growth, strong financial position and expanding opportunities in AI and cloud infrastructure, we recommend a buy. The company has demonstrated strong profitability, supported by healthy returns on equity. Its leadership in optical networking technologies, including CPO, OCS and high-speed photonics, continues to drive growth. With ample liquidity and upward earnings estimate revisions, Lumentum is well positioned for sustained long-term growth. Although the stock commands a premium valuation, its fundamentals justify it, making LITE a strong buy for growth-oriented investors.
LITE stock currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
SummaryLumentum (LITE) is evolving from a component supplier to a full system provider, moving up the optical stack and expanding its value proposition.I rate LITE a buy with 15-20% upside, targeting an implied price of $845.66 based on premium industry positioning and margin expansion.LITE's sales CAGR (83.8% vs 23.1% peers, '25-'27) and margin growth support its premium valuation, solidifying its role in datacenter infrastructure.Key risks include heavy revenue concentration with NVIDIA and Apple, making LITE vulnerable to shifts in customer roadmaps or architectures. JHVEPhoto/iStock Editorial via Getty Images
Thesis There is a lot of focus on EMLs and laser share when it comes to Lumentum, which is warranted given the company's specialization. But most of this commentary is missing one key fact, and that is
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Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.
SummaryLumentum (LITE) corrected roughly 33% from its peak as valuation excess unwound after the rapid AI-driven repricing phase.Selloff unfolded in four waves, including profit-taking, multiple compression, macro repricing, and sector-wide AI narrative shock.Structural AI demand remains intact, driven by optical interconnect transition, 1.6T scaling, and hyperscaler infrastructure expansion cycles.Execution visibility in OCS, CPO, and pump laser supply ramp remains key driver for next valuation re-acceleration phase. Erik Isakson/DigitalVision via Getty Images
The 33% correction from Lumentum's (LITE) May 2026 peak is not the kind of correction that normally suggests a broken thesis. On the contrary, in my opinion, there has been a multi-layered de-rating of investor
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Analyst’s Disclosure: I/we have a beneficial long position in the shares of LITE either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.
Key Takeaways Lumentum's Components segment hit a record $533.3M, making up 66% of Q3 revenues.AI data-center demand drove record EML chip shipments and strong laser assembly growth.Ultra-high-power laser chips and CPO are expected to become meaningful contributors later in FY26. Lumentum Holdings’ (LITE - Free Report) component business is accelerating rapidly, positioning the company for continued revenue growth as AI-driven demand for optical networking solutions remains robust. In the third quarter of fiscal 2026, Lumentum's Components segment generated a record $533.3 million, accounting for 66% of total revenues, while revenues climbed 20.2% sequentially and 77.3% year over year, underscoring that components have become the primary engine of its business expansion.
The strong performance was driven by record shipments of electro-absorption modulated laser (EML) chips, more than 120% year-over-year growth in narrow-linewidth laser assemblies and 80% growth in pump lasers, fueled by rising demand from hyperscale AI data centers. Management also noted that several high-growth component categories remain effectively sold out, while its Japan wafer fabrication capacity is fully allocated, indicating sustained customer demand and strong revenue visibility.
Lumentum is also laying the groundwork for its next phase of growth through ultra-high-power laser chips and co-packaged optics (CPO), which management expects to become meaningful revenue contributors later in 2026. The richer mix of premium AI components helped lift non-GAAP operating margin to 32.2% in the reported quarter, demonstrating that the company is not only growing revenue but also improving profitability.
Lumentum's recent updates underscore that optical components are becoming indispensable to next-generation AI infrastructure, with co-packaged optics emerging as another meaningful growth driver. As hyperscale cloud providers accelerate investments in AI networking, the company's expanding portfolio of advanced optical components is well positioned to capture this demand. Its increased fourth-quarter fiscal 2026 revenue guidance of $960 million-$1.01 billion further suggests that management expects the strong momentum in the Components segment to continue, strengthening LITE's long-term growth outlook.
Lumentum Faces Stiff CompetitionLumentum faces stiff competition from Coherent Corp. (COHR - Free Report) and Applied Optoelectronics (AAOI - Free Report) as AI-driven demand for optical components, photonics and data center networking continues to accelerate.
Coherent challenges Lumentum through broad photonics capabilities, 800G/1.6T transceivers, optical circuit switches and co-packaged optics. Coherent strengthens its edge with 6-inch indium phosphide production, long-term supply agreements and aggressive capacity expansion. The company also benefits from robust AI networking demand, expanding backlog and differentiated manufacturing scale.
Applied Optoelectronics competes with Lumentum by scaling 800G and 1.6T transceivers, expanding U.S. manufacturing and leveraging in-house laser production. Applied Optoelectronics emphasizes automation, production flexibility and capacity growth to address accelerating AI infrastructure demand. It also targets co-packaged optics and hyperscale customers, reinforcing its long-term growth strategy.
LITE’s Share Price Performance, Valuation & EstimatesShares of LITE have surged 132.8% year to date compared with the Computer and Technology sector’s growth of 18.2%.
LITE’s YTD Price Performance
Image Source: Zacks Investment Research
From a valuation standpoint, LITE trades at a forward price-to-sales ratio of 22.26X, significantly higher than the sector’s average of 6.62X. LITE carries a Value Score of F.
LITE’s Valuation
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for LITE’s fiscal 2027 earnings implies year-over-year growth of 118.77%. The consensus estimate for fiscal 2027 has been revised upward in the past 30 days.
Image Source: Zacks Investment Research
Lumentum stock carries a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
SAN JOSE, Calif.--(BUSINESS WIRE)--Lumentum Holdings Inc. (“Lumentum”), a global leader in optical and photonic technologies that power the networks and infrastructure behind artificial intelligence (AI), today announced that Penny Herscher, Chair of the Board, and Michael Hurlston, President and Chief Executive Officer, will participate as expert speakers at the Rome Conference on AI, Ethics, and Governance, taking place June 18–20, 2026.
The third annual conference will convene global leaders from technology, business, policy, academia, and civil society to examine the evolving impact of AI. The event will feature moderated panel sessions and fireside chats with leading AI executives, providing an opportunity to engage in strategic and practical discussions, share emerging best practices, and build connections.
Lumentum executives will participate in the following sessions:
Friday, June 19, at 12:00 p.m.
Panel 2: The Benefits and Challenges of AI
Panelist: Penny Herscher, Chair of the Board, Lumentum Saturday, June 20, at 3:00 p.m.
Panel 3: The Energy of AI: Infrastructure, Stewardship, and the Common Good
Panelist: Michael Hurlston, President and Chief Executive Officer, Lumentum Lumentum is a technology innovator providing advanced optical products for data centers that support improved energy efficiency. As data center networks continue to transition from copper to optics, products such as Lumentum’s optical circuit switches (OCS), transmit-retimed optical (TRO) modules, and lasers for co-packaged optics (CPO) reduce power consumption, cooling requirements, and overall data center water usage.
Lumentum is committed to sustainability and has set a goal to achieve net-zero greenhouse gas emissions by 2030.
For more information about this event, visit: Rome Conference on AI.
About Lumentum
Lumentum (NASDAQ: LITE) is a global leader in optical and photonic technologies that power the networks and infrastructure behind AI, cloud computing, and next-generation communications. Built on decades of photonics innovation, Lumentum delivers high-performance lasers, modules, and optical subsystems that enable scalable, energy-efficient data center connectivity, advanced telecom networks, industrial manufacturing, and sensing applications. Headquartered in San Jose, California, the company operates R&D, manufacturing, and sales facilities worldwide. Learn more at www.lumentum.com.
Key Takeaways Lumentum and Broadcom are gaining from AI infrastructure, cloud demand and data center connectivity.LITE posted record Q3 FY26 revenues of $808.4M, with AI demand boosting margins and sales.AVGO's AI chip revenues jumped 143%, but LITE's momentum makes it the stronger pick now. Lumentum Holdings (LITE - Free Report) and Broadcom (AVGO - Free Report) are two technology companies playing important roles in enterprise networking, cloud infrastructure and data center connectivity. Lumentum specializes in optical and photonic products used in high-speed communications, while Broadcom provides semiconductor and infrastructure software solutions powering enterprise and AI-driven networks worldwide.
Both companies are benefiting from rising demand for AI infrastructure, cloud computing and secure high-speed data transmission. Their technologies support the backbone of enterprise and hyperscale data centers, making them closely tied to the expanding digital economy.
Lumentum and Broadcom remain in focus as investors seek companies positioned to benefit from AI-led networking upgrades and rising enterprise spending on connectivity and security infrastructure. Let's dig in and find which stock offers the stronger investment case now.
The Case for LITE StockLumentum is strengthening its position as a leading AI networking and infrastructure enabler, benefiting from soaring demand for optical connectivity in hyperscale AI data centers. The company’s optical and photonic portfolio supports AI/ML workloads, cloud networking and data center interconnect applications through transceivers, laser chips, optical circuit switches (OCS), pump lasers and co-packaged optics (CPO).
Lumentum delivered a standout third-quarter fiscal 2026 performance, with revenues surging 90.1% year over year to a record $808.4 million. Non-GAAP operating margin expanded sharply to 32.2% from 10.8% a year ago, reflecting strong AI-driven demand and a favorable product mix. Components revenues surged 77.3%, while systems revenues jumped 121.1%, driven by cloud transceivers and AI networking products.
Management highlighted exceptionally strong demand for narrow-linewidth laser assemblies, pump lasers, 200G EMLs and optical interconnect technologies supporting 1.6T architectures. The company stated several AI-focused products remain effectively sold out for the foreseeable future. Lumentum is also ramping ultra-high-power laser chips for CPO applications and expects meaningful revenue contribution by late 2026.
A major growth catalyst is the acquisition of a fifth indium phosphide fabrication facility in Greensboro, NC, which expands long-term manufacturing capacity for AI optics and advanced laser technologies. The company’s OCS platforms are increasingly critical for scalable and energy-efficient AI clusters.
Lumentum is also benefiting from Nvidia’s multibillion-dollar optical networking agreements and strategic investments tied to next-generation AI switches and CPO deployments. The company expects fourth-quarter fiscal 2026 revenues of $960 million-$1.01 billion with non-GAAP EPS of $2.85-$3.05, underscoring strong AI infrastructure momentum.
The Case for AVGO StockBroadcom is gaining momentum as a leading AI infrastructure and AI networking provider, supported by accelerating hyperscale demand, expanding customer commitments and strong financial execution. The company’s semiconductor portfolio spans AI accelerators (XPUs), Ethernet switches, optical interconnects, SerDes, PCIe and networking fabrics that power AI data centers and large-scale AI clusters.
Broadcom’s AI momentum is translating into exceptional growth. In second-quarter fiscal 2026, total revenues surged 48% year over year to a record $22.2 billion, while AI semiconductor revenues jumped 143% to $10.8 billion. Networking contributed nearly 40% of AI revenues, highlighting Broadcom’s growing importance in AI connectivity infrastructure. Management expects AI semiconductor revenues to rise to $56 billion in fiscal 2026 and exceed $100 billion in fiscal 2027.
The company is benefiting from strategic AI partnerships with Google, Meta, OpenAI and Anthropic, supported by long-term agreements for custom AI accelerators and networking solutions.
Broadcom’s technology leadership in AI networking remains a major strength. The company is shipping the industry’s only 100-terabit Ethernet switch, Tomahawk 6, and is advancing next-generation 200-terabit switching technology. Its Jericho fabric solutions and co-packaged optics leadership further strengthen its competitive moat in AI infrastructure.
However, risks remain. Broadcom faces customer concentration risks, supply-chain dependencies, cyclical semiconductor demand fluctuations and rising competition in AI networking and accelerators. The company also carries substantial debt following major acquisitions, with long-term debt totaling $62.7 billion as of May 2026. Despite these risks, Broadcom’s scale, AI backlog, robust free cash flow generation and strong execution position AVGO favorably within the rapidly expanding AI infrastructure market.
LITE & AVGO: Price Performance and ValuationIn the year-to-date (YTD) period, Lumentum shares have skyrocketed 150%, immensely outperforming Broadcom’s 10.4% gain and the broader sector’s 15.7% growth, reflecting investors’ strong optimism around Lumentum’s accelerating AI-driven optical networking and margin expansion opportunities.
AVGO shares have underperformed as the company remains exposed to integration risks and execution challenges tied to large acquisitions, particularly VMware, while its sizable debt load continues to drive significant interest expenses. In addition, weakness in certain non-AI semiconductor markets and slowing enterprise spending on some infrastructure software products have acted as near-term headwinds despite strong AI networking demand.
LITE and AVGO YTD Stock Performance
Image Source: Zacks Investment Research
LITE shares are currently trading at a premium, as suggested by a Value Score of F. AVGO shares are relatively cheap compared to LITE, as suggested by a Value Score of D.
LITE’s forward 12-month P/S ratio of 13.23X is higher than AVGO’s 12.72X. Lumentum’s valuation premium is supported by its AI-driven optical networking growth, expanding margins and rapidly scaling cloud transceiver and laser chip businesses.
Price-to-Sales F12M
Image Source: Zacks Investment Research
How Do Earnings Estimates Compare for LITE & AVGO?The Zacks Consensus Estimate for LITE’s fiscal 2026 and 2027 earnings indicates increases of 298.54% and 115.37%, respectively. Over the past month, earnings estimates for both years have been unchanged.
LITE Estimate Trend
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The Zacks Consensus Estimate for AVGO’s fiscal 2026 and 2027 earnings indicates 71.99% and 63.27% growth, respectively. Over the past month, earnings estimates for both years have been revised upward.
AVGO Estimate Trend
Image Source: Zacks Investment Research
LITE or AVGO: Which Stock to Invest in Now?While Broadcom remains a dominant AI infrastructure player with strong long-term growth prospects, Lumentum currently offers the more compelling investment opportunity. Its explosive AI-driven revenue growth, expanding margins, rapidly scaling optical networking business and strong demand visibility position LITE for superior near-term upside. Despite its premium valuation, Lumentum’s accelerating momentum, higher earnings estimates and AI infrastructure exposure make it the better stock to invest in now.
Currently, LITE sports a Zacks Rank #1 (Strong Buy), while AVGO carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank stocks here.
Revenue surged 90% year over year to $808 million despite management reporting demand exceeding supply by over 30%. Components revenue reached $533 million, growing 20% sequentially and 77% annually as AI optical demand accelerated. Non-GAAP operating margin expanded 2,140 basis points to 32.2%, with Q4 guidance implying further profitability gains.
Analyst’s Disclosure: I/we have a beneficial long position in the shares of LITE, MRVL, NVDA either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.
HomeIndustriesComputers/ElectronicsTech StocksTech StocksNvidia’s Jensen Huang spoke highly of Marvell, and his comments are sparking broad enthusiasm for providers of optical componentsLast Updated: June 2, 2026 at 6:24 p.m. ET
First Published: June 2, 2026 at 3:11 p.m. ET
Nvidia CEO Jensen Huang had high praise today for Marvell, a maker of optical components that he said could become a $1 trillion company. And investors seem to be transferring those rosy feelings to other optical-components stocks.
Shares of Marvell MRVL and Coherent COHR were up 33% and 18%, respectively, while shares of Lumentum Holdings LITE surged 14%. Corning’s stock GLW was also up 13% on Tuesday.
It has been about a month since the last earnings report for Lumentum (LITE - Free Report) . Shares have lost about 0.7% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Lumentum due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the latest earnings report in order to get a better handle on the important catalysts.
Lumentum Q3 Earnings Top Estimates, Revenues Up Y/YLumentum Holdings delivered non-GAAP earnings of $2.37 per share, which beat the Zacks Consensus Estimate by 5.8% and surged significantly from 57 cents reported in the year-ago quarter.
Revenues of $808 million increased 90.1% year over year and edged past expectations by 0.37%. The quarter’s results reflected strong cloud and AI demand, with components revenue reaching $533.3 million (66% of total sales), supported by momentum in laser chips and “scale-across” products that management highlighted as an important margin lever.
LITE’s Systems Growth Led by Cloud Transceiver StrengthSystems revenues were $275.1 million, rising 121.1% year over year and 24% sequentially. Management said cloud transceivers accounted for the majority of the segment’s growth as Lumentum leveraged an expanded manufacturing footprint in Thailand.
Optical circuit switches also contributed, with management describing a multi-year, multibillion-dollar purchase agreement as a foundation for long-term growth. However, the company noted that supply-chain tightness remains a gating factor for the pace of the ramp, especially given a step-up in requested output.
Lumentum Highlights Scale-Across Demand and Laser MomentumLumentum emphasized that its “scale-across” portfolio is becoming more material as hyperscalers link compute domains across distributed data center architectures. Management called out pump lasers and narrow linewidth laser assemblies as key building blocks for these networks, with the latter providing the precision needed for higher-speed coherent links.
Operationally, the company posted strong shipment trends across core components. Narrow-linewidth laser assemblies grew more than 120% year over year, while pump laser shipments increased 80%, reflecting demand for higher-bandwidth networking and optical amplification. Management also pointed to new company records in EML shipments, driven by 100-gig lane speeds, with 200-gig EML revenue more than doubling sequentially.
LITE’s Margins Expand Sharply on Mix and UtilizationNon-GAAP gross margin was 47.9%, up 540 basis points (bps) sequentially and significantly expanded from 35.2% reported in the year-ago quarter. Management attributed the improvement to better factory utilization, selective pricing actions and a more favorable mix, with strength in data center laser chips a key contributor.
Non-GAAP operating expenses were $126.2 million (up 22.1% year over year), or 15.6% of revenue, reflecting continued investment in research and development and commercial support for expanding cloud opportunities while maintaining tight cost controls.
Profitability translated into sizable operating leverage. Non-GAAP operating margin improved to 32.2%, up 700 bps sequentially and significantly expanded from 10.8% reported in the year-ago quarter.
Lumentum’s Balance Sheet Bolstered by Large Equity ProceedsLumentum ended the fiscal third quarter with $3.17 billion in total cash, cash equivalents, and short-term investments, up from $2.02 billion sequentially, primarily due to proceeds from the issuance of Series A Convertible Preferred Stock. The larger cash position provides flexibility as the company scales manufacturing and supports new program ramps tied to cloud and AI infrastructure.
Working capital and investment levels reflected growth expectations. Inventories increased by $62 million sequentially to support expected demand, and capital expenditures totaled $125 million, focused mainly on manufacturing capacity expansion. Management also underscored longer-term capacity efforts, including progress toward converting an acquired Greensboro, NC, facility to indium phosphide manufacturing.
LITE Guides to Another Record Quarter as 1.6T RampsFor the fourth quarter of fiscal 2026, Lumentum expects revenues between $960 million and $1.01 billion. The company guided non-GAAP operating margin to 35-36% and non-GAAP earnings to $2.85-$3.05 per share, based on an effective tax rate assumption of 16.5% and approximately 102 million diluted shares.
Management said a meaningful driver of sequential growth is expected to be transceivers, with 1.6T shipments poised to ramp in the fiscal fourth quarter. The company also expects further progress on integrating internal CW lasers into its module portfolio, with management indicating that roughly 20% of modules in the near-term mix could include Lumentum’s own CW lasers, alongside ongoing yield improvements and efforts to reduce scrap.
How Have Estimates Been Moving Since Then?In the past month, investors have witnessed a upward trend in fresh estimates.
The consensus estimate has shifted 19.17% due to these changes.
VGM ScoresCurrently, Lumentum has a nice Growth Score of B, though it is lagging a lot on the Momentum Score front with a D. Charting a somewhat similar path, the stock has a grade of F on the value side, putting it in the lowest quintile for value investors.
Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.
OutlookEstimates have been trending upward for the stock, and the magnitude of these revisions looks promising. It comes with little surprise Lumentum has a Zacks Rank #1 (Strong Buy). We expect an above average return from the stock in the next few months.
Performance of an Industry PlayerLumentum belongs to the Zacks Communication - Components industry. Another stock from the same industry, NETGEAR, Inc. (NTGR - Free Report) , has gained 2.5% over the past month. More than a month has passed since the company reported results for the quarter ended March 2026.
NETGEAR reported revenues of $158.82 million in the last reported quarter, representing a year-over-year change of -2%. EPS of $0.06 for the same period compares with $0.02 a year ago.
NETGEAR is expected to post earnings of $0.02 per share for the current quarter, representing a year-over-year change of -66.7%. Over the last 30 days, the Zacks Consensus Estimate has changed +9.7%.
The overall direction and magnitude of estimate revisions translate into a Zacks Rank #3 (Hold) for NETGEAR. Also, the stock has a VGM Score of B.
The AI memory supercycle is real and still running. High-bandwidth memory (HBM) became the scarce resource around which the entire AI industry organized. Investors who got there early made a lot of money.
This caused the conversation in AI infrastructure to shift. Power is one constraint. But the issue that engineers are losing sleep over is optical interconnect, the technology that moves data between chips at the speed of light, inside and between servers. As AI models grow larger and more distributed, moving data across copper wires becomes too slow and too power-hungry.
Silicon photonics is becoming the next critical layer of the AI stack. The silicon photonics market is estimated at $3.6 billion in 2026 and is projected to reach $15.7 billion by 2033 -- a 23.2% compound annual growth rate. Lumentum Holdings (LITE +3.94%) is the stock in this market I'd buy right now, before this cycle gets crowded.
Image source: Getty Images.
In March 2026, Nvidia (NVDA 0.11%) invested $2 billion in Lumentum through a private placement of convertible preferred stock and signed a multibillion-dollar purchase commitment for advanced laser components. One month later, Lumentum announced a new 240,000-square-foot manufacturing facility in Greensboro, North Carolina, acquired from semiconductor company Qorvo. The facility will produce indium phosphide (InP)-based optical devices -- the lasers that power next-generation AI transceivers -- with Nvidia confirmed as a customer.
The Greensboro facility isn't expected to ramp production until mid-2028. Think about that for a second. Nvidia is not only paying for Lumentum's future capacity today -- it's building supply chain infrastructure for a product cycle that won't fully arrive for two years. That is a sign that the company is locking in a critical supplier before demand overwhelms supply.
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A risk: Lumentum's stock is up over 1,100% in the last year Lumentum's stock has moved sharply in 2026, which might make it feel late. Over the past year, the stock has surged an extraordinary 1,110%, climbing from roughly $77 to $938 per share.
But the InP fab is not yet producing. When that fab alone starts operations, it could bump the ticker up another 100%. The 1.6 terabit-per-second transceiver generation has barely shipped at scale. The co-packaged optics transition -- where the transceiver moves inside the chip package itself -- is a product cycle that has yet to produce meaningful revenue at any company.
The risk is with Lumentum timing. Optical supercycles can stretch, and if Nvidia's roadmap shifts or AI capex growth slows, Lumentum's growth rates could compress before Greensboro comes online. Dilution from the preferred stock conversion is also worth watching.
But if you're looking for the infrastructure layer that moves from "important" to "indispensable" over the next five years, photonics is the answer. And Lumentum is the company with a $2 billion strategic partner, a domestic fab, and a product roadmap to back it up.
Key Takeaways LITE raised Q4 FY26 revenue guidance to $960M-$1.01B on strong AI networking demand.Lumentum posted record Q3 FY26 revenue growth of 90% YoY to $808.4M.LITE is expanding capacity with its North Carolina fab to support long-term AI networking growth. Lumentum Holdings’ (LITE - Free Report) growth outlook is strengthening as surging AI infrastructure demand continues to drive revenue expansion, margin improvement and long-term business opportunities. The company raised its fiscal fourth-quarter guidance amid accelerating demand across cloud networking, optical interconnect and hyperscale data center infrastructure markets. Lumentum expects fourth-quarter fiscal 2026 revenues between $960 million and $1.01 billion, driven by strong momentum in cloud transceivers, laser chips and scale-across networking products.
Lumentum’s third-quarter fiscal 2026 performance highlighted the strength of this trend, with revenues surging 90% year over year to a record $808.4 million. Management emphasized that hyperscalers are increasingly deploying distributed AI data center architectures that require high-bandwidth optical synchronization across multiple facilities. This shift is driving strong demand for the company’s pump lasers, wavelength-selectable switches and narrow linewidth laser assemblies.
LITE is also benefiting from robust adoption of AI-related laser chips and cloud transceivers. Record EML laser chip shipments, rapid growth in 200-gig EML revenues and the upcoming ramp of 1.6T transceivers are strengthening the company’s competitive positioning in next-generation AI infrastructure markets. Importantly, management noted that several critical optical components remain effectively sold out for the foreseeable future, reflecting strong underlying demand conditions.
Lumentum is simultaneously expanding manufacturing capacity to support long-term growth. Its recently acquired indium phosphide fab in North Carolina is expected to provide years of additional production capability for AI networking applications. Coupled with improving product mix and operating leverage, these investments are enhancing profitability and reinforcing Lumentum’s long-term growth potential.
Lumentum’s Competitors Gain Momentum From AI DemandMarvell Technology (MRVL - Free Report) is gaining momentum from rising AI infrastructure demand, making MRVL a strong competitor to Lumentum in AI networking. MRVL is benefiting from strong demand for optical interconnects, custom silicon and switching solutions used in hyperscale AI clusters. The company’s scale-out, scale-up and scale-across networking technologies, along with its NVIDIA partnership in silicon photonics and AI infrastructure, strengthen its competitive position. However, rising R&D spending and intense competition remain key challenges for MRVL.
Coherent Corp. (COHR - Free Report) continues to gain momentum from rising AI infrastructure demand, emerging as a key rival to Lumentum in optical networking and photonics. COHR is seeing strong growth in 800G and 1.6T transceivers, optical circuit switches (OCS) and co-packaged optics (CPO), supported by rising AI data center demand and its NVIDIA partnership. The company also benefits from its 6-inch indium phosphide production capability, which improves yields and expands capacity. Yet, supply constraints and high capital spending remain challenges for COHR.
LITE’s Share Price Performance, Valuation & EstimatesLumentum’s shares have surged 134.3% year to date, significantly outperforming the Zacks Computer and Technology sector’s 16.2% gain and the Zacks Communication – Components industry’s 105.9% rise.
LITE’s Price Performance
Image Source: Zacks Investment Research
LITE trades at a premium with a forward 12-month P/E ratio of 50.48X compared with the industry's 49.65X. LITE carries a Value Score of F.
LITE’s Valuation
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for LITE’s fiscal 2026 earnings is pegged at $8.21 per share, up 0.7% over the past 30 days and reflecting remarkable growth of 298.54% year over year.
Image Source: Zacks Investment Research
Lumentum flaunts a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Portfolio returned -4.62% ((gross)) and the S&P 500® Index returned -4.33% for the first quarter of 2026. Vertiv is an essential supplier of cooling, power management, and rack systems to AI data centers, with its orders backlog more than doubling on a year-over-year basis. NVIDIA announced that it would invest $2 billion in Lumentum to secure future capacity, further highlighting Lumentum's growing market power as a key provider of mission-critical components.
Key Takeaways Lumentum is expanding CPO and laser chip capacity to support growing AI data center demand.LITE expects up to $1.01B in Q4 fiscal 2026 revenue with improving profitability guidance.Lumentum's AI networking portfolio and vertical integration strengthen long-term positioning. Lumentum Holdings’ (LITE - Free Report) shares have declined 14.9% over the past month, significantly underperforming the broader Zacks Computer and Technology sector’s modest 0.2% decline. The pullback reflects investor concerns surrounding supply-chain bottlenecks, execution risks tied to aggressive AI-related capacity expansion and persistent weakness across non-AI businesses despite strong quarterly results.
Investors also remain cautious about elevated AI infrastructure CapEx, rising inventory levels and large-scale manufacturing expansion initiatives, which could pressure near-term profitability and execution. In addition, continued softness in industrial lasers and cable access markets has reinforced concerns over the company’s growing dependence on AI-driven demand for growth.
Despite these near-term headwinds, Lumentum continues to strengthen its position in Optical Interconnect & Data Center Networking, Co-Packaged Optics (CPO) & Advanced Laser Chip Expansion and Manufacturing Capacity Expansion & Vertical Integration Strategy. This raises a key question for investors: Does this recent decline create an attractive buying opportunity, or do the risks still outweigh the long-term growth potential? Let’s take a closer look.
Strong CPO & Laser Chip Demand Aids LITE’s ProspectsLumentum Holdings’ expanding presence in CPO and advanced laser chip technologies is emerging as one of the company’s strongest long-term investment drivers. Management highlighted that ultra-high-power laser chip manufacturing for CPO applications is ramping according to plan, with meaningful revenue contribution expected by the December 2026 quarter. The company has already secured a multi-hundred-million-dollar purchase order scheduled for the first half of calendar 2027, underscoring growing customer confidence in its next-generation optical solutions. In addition, Lumentum continues collaborating with multiple CPO customers through turnkey external laser source module solutions, strengthening its position in future AI networking architectures.
The opportunity is significant because co-packaged optics is increasingly viewed as a critical technology for solving power consumption, bandwidth density and scalability challenges in AI data centers. Lumentum’s leadership in electro-absorption modulated lasers (EMLs), CW lasers and indium phosphide-based photonics gives it a strategic advantage as hyperscalers transition toward higher-speed 1.6T and future AI interconnect technologies. To support this growth, the company acquired a fifth indium phosphide fab in North Carolina, ensuring production capacity for many years of future expansion.
LITE’s Strong Portfolio Drives Competitive EdgeLITE’s expanding AI optical networking portfolio continues to strengthen its long-term competitive positioning despite recent stock underperformance relative to rivals like Coherent Corp. (COHR - Free Report) and Broadcom Inc. (AVGO - Free Report) , though it has performed better than Ciena Corporation (CIEN - Free Report) . Over the past month, Coherent shares have gained 5.9%, while Broadcom has declined a comparatively modest 7.4%. In contrast, Ciena shares have dropped a steeper 19.7%.
Lumentum continues to benefit from strong demand for its narrow linewidth laser assemblies, pump lasers, EMLs and wavelength selective switches, driven by hyperscaler investments in AI infrastructure and scale-across data center architectures. Coherent remains a major competitor in optical networking, photonics and high-speed transceivers, while Broadcom Inc. competes aggressively in AI interconnect, networking silicon and CPO technologies. However, Lumentum’s vertically integrated indium phosphide manufacturing capabilities and growing exposure to CPO applications strengthen its long-term positioning.
Lumentum also competes with Ciena Corporation in optical transport and high-capacity networking systems for telecom and cloud operators. As AI clusters become larger and more bandwidth-intensive, Lumentum appears well-positioned to compete effectively across the AI optical networking market.
LITE’s One-month Price Return Performance
Image Source: Zacks Investment Research
LITE’s Earnings Estimate Revision Shows Positive TrendFor the fourth quarter of fiscal 2026, the company expects revenues between $960 million and $1.01 billion, highlighting confidence in continued growth across cloud and AI infrastructure markets. Lumentum also guided non-GAAP earnings to $2.85-$3.05 per share, suggesting improving profitability and operating leverage.
The Zacks Consensus Estimate for fourth-quarter fiscal 2026 revenues is currently pegged at $986.69 million, indicating a massive 105.26% increase from the year-ago quarter’s reported figure. In addition, the consensus estimate for LITE’s fiscal 2026 earnings stands at $2.96 per share, which has increased 13% over the past 60 days. The estimate also reflects remarkable year-over-year earnings growth of 236.36%.
Image Source: Zacks Investment Research
LITE Trades Higher Than Sector & IndustryLumentum trades at a premium valuation as reflected in its Value Score of F. In terms of the 12-month price/sales (P/S), LITE is currently trading at 12.93X, higher than the Zacks Communication – Components industry and the Zacks Computer and Technology sector’s 7.38X and 6.59X, respectively.
Lumentum’s premium valuation is supported by its strong exposure to rapidly growing AI infrastructure markets, expanding demand for optical networking products and leadership in co-packaged optics (CPO), laser chips and cloud photonics technologies.
Price/Sales Ratio (F12M)
Image Source: Zacks Investment Research
Verdict: Buy LITE for NowAlthough near-term risks surrounding supply-chain constraints and aggressive capacity expansion remain, Lumentum’s accelerating exposure to AI optical networking, co-packaged optics and advanced laser technologies continues to strengthen its long-term outlook. Supported by rising earnings estimates, strong hyperscaler demand and expanding manufacturing scale, the recent decline may represent an attractive entry point into a rapidly growing AI infrastructure market.
LITE currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Lumentum Holdings receives a buy rating as I see its bull case far from finished. LITE leads the photonic revolution, crucial for data center buildouts, supporting robust top and bottom-line growth. A recent revenue miss is not concerning; a 90% YoY top-line surge reinforces continued bullishness.
Lumentum (LITE +4.36%) has become one of the market's most dramatic artificial intelligence infrastructure stories. The stock has soared, revenue growth is accelerating, and Wall Street still sees upside. But with expectations already sky-high, investors now face a critical question: can the company grow fast enough to justify the rally?
Stock prices used were the market prices of June 1, 2026. The video was published on June 11, 2026.
Rick Orford has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Lumentum. The Motley Fool has a disclosure policy. Rick Orford is an affiliate of The Motley Fool and may be compensated for promoting its services. If you choose to subscribe through their link, they will earn some extra money that supports their channel. Their opinions remain their own and are unaffected by The Motley Fool.
Key Takeaways Lumentum raised cash and short-term investments to about $3.17B in Q3 FY26.Operating cash flow rose to $388.4M in the first nine months, helped by AI optical shipments.New facilities in North Carolina and Thailand aim to expand capacity and improve supply-chain resilience. Lumentum Holdings’ (LITE - Free Report) strengthening liquidity position is improving financial stability and making its long-term growth outlook safer as booming AI-networking demand boosts cash generation, profitability and financial flexibility. During the third quarter of fiscal 2026, the company increased total cash, cash equivalents and short-term investments to roughly $3.17 billion, supported by strong operating cash flow and major financing initiatives. This stronger balance sheet is allowing Lumentum to aggressively expand manufacturing capacity, invest in advanced optical technologies and support rising demand for hyperscale AI infrastructure.
The improving liquidity profile is also being supported by stronger cash generation. The company’s operating cash flow improved sharply to $388.4 million in the first nine months of fiscal 2026, reflecting strong operating leverage, expanding operating margins and accelerating shipments of AI-focused optical products.
Importantly, Lumentum is deploying its liquidity strength toward long-term capacity expansion. The company recently expanded its manufacturing footprint through a new indium phosphide facility in North Carolina and additional production investments in Thailand. These initiatives should help LITE address growing AI-related demand while improving supply-chain resilience and revenue visibility.
Strategic partnerships are further strengthening long-term opportunities. Lumentum’s collaboration with NVIDIA and its growing exposure to co-packaged optics, optical circuit switching and AI data-center interconnect technologies position the company well for sustained long-term expansion. Although macroeconomic risks, tariffs and high capital expenditures remain concerns, Lumentum’s strong liquidity supports growth expansion.
Supporting this optimism, analysts’ revenue forecasts remain exceptionally strong. The Zacks Consensus Estimate projects annual revenue growth rates of 82.03% and 84.76% for fiscal 2026 and 2027, respectively.
How LITE’s Rivals Maintain Strong Liquidity for Future GrowthCoherent Corp. (COHR - Free Report) is strengthening liquidity through disciplined cost controls, AI-driven optical networking demand and improved cash generation, directly challenging Lumentum. COHR benefits from diversified photonics exposure and strong hyperscaler demand, while also focusing on balance-sheet flexibility through restructuring initiatives. However, COHR faces integration and margin pressures from acquisitions.
Applied Optoelectronics (AAOI - Free Report) is improving liquidity through rising AI transceiver demand, debt management and expanding cloud-data-center partnerships, placing it in closer competition with Lumentum. AAOI gains an advantage from focused optical transceiver specialization and faster AI-related revenue momentum. Still, AAOI remains vulnerable to customer concentration risks and earnings volatility.
LITE’s Share Price Performance, Valuation & EstimatesLumentum’s shares have surged 164.5% in the past six months, significantly outperforming the Zacks Computer and Technology sector’s 14.4% gain and the Zacks Communication – Components industry’s 99.4% rise.
LITE’s Price Performance
Image Source: Zacks Investment Research
LITE’s valuation remains stretched, as reflected by its forward 12-month P/S ratio of 12.8X versus the sector’s 6.39X. LITE carries a Value Score of F.
LITE’s Valuation
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for LITE’s fiscal 2027 earnings is pegged at $17.68 per share, up 3 cents over the past 30 days and indicating strong year-over-year growth of 115.37%.
Lumentum flaunts a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
