Lumentum Raises Earnings Guidance, Analysts React Positively

Lumentum Holdings Inc. (NASDAQ: LITE) has updated its earnings guidance for the second quarter of 2026, projecting earnings per share (EPS) between $1.300 and $1.500. This forecast significantly exceeds the consensus EPS estimate of $0.990. In addition, the company anticipates revenue between $630 million and $670 million, compared to the consensus estimate of $560.8 million.

Analyst Ratings and Market Response

A recent wave of analyst activity has further buoyed Lumentum’s stock. On August 13, 2023, Stifel Nicolaus increased its price target on Lumentum shares from $100.00 to $132.00, maintaining a “buy” rating. Similarly, KGI Securities initiated coverage with an “outperform” rating on August 18.

Needham & Company LLC also reaffirmed its “buy” rating and raised its price objective from $135.00 to $145.00 on the same day. Meanwhile, Bank of America upgraded its stance from “underperform” to “neutral,” elevating the price target from $78.00 to $135.00.

Currently, one analyst has rated the stock with a Strong Buy, twelve with a Buy, and six with a Hold. According to MarketBeat.com, Lumentum has a consensus rating of “Moderate Buy” with an average price target of $149.43.

Performance Insights

In its last earnings report on November 4, 2023, Lumentum reported an EPS of $0.60, falling short of analysts’ expectations of $1.03 by $0.43. The company recorded a negative return on equity of 3.02% and a net margin of 1.57%. Analysts predict an EPS of $0.03 for the current fiscal year.

Insider Trading Activities

Recent trading activity among insiders has also drawn attention. On August 18, Director Julia Suzanne Johnson sold 1,250 shares at an average price of $119.06, totaling $148,825.00. Following this transaction, she holds 22,037 shares valued at approximately $2.62 million, marking a 5.37% decrease in her ownership.

On August 25, insider Yuen Wupen sold 3,282 shares at an average price of $119.25, amounting to $391,378.50. After the sale, Wupen retained 104,554 shares, valued around $12.47 million, which represented a 3.04% decrease in ownership. Over the last three months, insiders have sold a total of 18,439 shares valued at $2.21 million. Currently, insiders hold 0.43% of Lumentum’s stock.

Institutional Investment Trends

Hedge funds and institutional investors have recently increased their stakes in Lumentum. Thrivent Financial for Lutherans grew its holdings by 0.7% during the second quarter, now owning 16,340 shares worth approximately $1.55 million. Advisors Asset Management Inc. raised its stake by 36.8% in the first quarter, totaling 945 shares valued at $59,000.

Moreover, Federated Hermes Inc. increased its holdings by 7.3% in the second quarter, now owning 4,985 shares valued at $474,000. Empowered Funds LLC has also raised its stake by 9.1% in the first quarter, owning 8,139 shares valued at $507,000. Overall, approximately 94.05% of Lumentum’s stock is owned by hedge funds and institutional investors.

About Lumentum

Lumentum Holdings Inc. specializes in manufacturing and selling optical and photonic products globally, with operations in the Americas, Asia-Pacific, Europe, the Middle East, and Africa. The company operates through two key segments: Optical Communications (OpComms) and Commercial Lasers (Lasers). The OpComms segment provides components, modules, and subsystems that facilitate the transmission of video, audio, and data over high-capacity fiber optic cables.

Investors and analysts alike will be watching closely as Lumentum continues to navigate its financial landscape and respond to market conditions.