Lumentum Holdings Inc. (LITE) AI Stock Analysis
LITE AI stock analysis summary
AI ResearchLumentum Holdings Inc. manufactures optical and photonic products for optical communications and commercial laser markets. In FY2026, the company generated $3.01B in revenue, reflecting an 83.2% annual growth rate. However, trailing twelve months net margin stood at -230.1% alongside net income of -$6.94B in FY2026.
- Market cap
- $74.65B
- Revenue (TTM)
- $3.01B
- P/E
- — fwd 42.9x
- 1Y return
- 404.9% S&P 500 16.8%
- Avg. target
- $1179.07 43.1% vs last close
Bull case
- FY2026 revenue increased 83.2% to $3.01B, driven by a 109.3% quarterly revenue growth rate in the latest quarter.
- The company generated $300.1M in free cash flow and maintained a net cash position of $1.07B as of June 30, 2026.
- Analysts project strong expansion for the fiscal year ending June 30, 2027, estimating EPS growth of 151.3% to $21.79 on $6.34B in revenue.
Bear case
- Lumentum reported FY2026 net income of -$6.94B, resulting in a trailing twelve month net margin of -230.1%.
- The stock trades at an EV to EBITDA multiple of 114.9x, which is elevated compared to the median of 30.6x for its Nasdaq-100 Technology peers.
- With a beta of 1.54, the stock exhibits higher volatility, having traded down to a 52-week low of $152.54.
What Lumentum does
Lumentum Holdings Inc. is a manufacturer and distributor of advanced optical and photonic products. It operates through two segments: Optical Communications (OpComms) and Commercial Lasers (Lasers). The OpComms segment provides components, modules, and subsystems for optical communication networks, including tunable transponders, transceivers, modulators, optical add/drop multiplexers, amplifiers, photodetectors, and switches for telecommunications and data communications. The Commercial Lasers segment offers diode-pumped solid-state, fiber, and gas lasers used in manufacturing, biotechnology, remote sensing, and precision machining for original equipment manufacturers.
Growth and profitability
Lumentum saw revenue decline 23.1% to $1.36B in FY2024 before rebounding 21.0% to $1.65B in FY2025 and 83.2% to $3.01B in FY2026. Gross margin rose to 41.7% in FY2026 from 28.0% in FY2025 and 18.5% in FY2024. Operating margin was 17.4% in FY2026 compared to -26.6% in FY2024 and -11.7% in FY2025. FY2026 net income was -$6.94B, down from $25.9M in FY2025, yielding an EPS of $7.78. For the latest quarter ended June 30, 2026, quarterly revenue grew 109.3% year-over-year, while quarterly earnings grew 71.1%.
Balance sheet and cash flow
As of June 30, 2026, Lumentum held $2.74B in cash and short-term investments and $1.67B in total debt, resulting in net cash of $1.07B. Shareholders' equity was $4.64B, with a debt-to-equity ratio of 0.36 and a current ratio of 1.68. Operating cash flow reached $751.4M in FY2026, supporting free cash flow of $300.1M. Capital expenditures were $451.3M, and the company allocated $102.0M toward share buybacks during FY2026.
Valuation and performance
Lumentum carries a forward P/E of 42.9x, above the 25.1x median of its Nasdaq-100 Technology peers. Its price-to-sales ratio of 24.8x and EV to EBITDA of 114.9x also exceed the peer medians of 11.9x and 30.6x, respectively. The stock has a PEG ratio of 0.63. Over the past year, the stock returned 404.9%, substantially outperforming the S&P 500 (SPY) return of 16.8%. Over five years, Lumentum returned 867.4% compared to 83.0% for the benchmark.
What analysts expect
Wall Street analysts maintain 17 Strong Buy, 5 Buy, and 4 Hold ratings on the stock, with zero Sell or Strong Sell ratings. The mean price target is $1179.07, representing a 43.1% upside compared to the last close of $824.13. For the current fiscal year ending June 30, 2027, consensus estimates project revenue of $6.34B and EPS of $21.79. Lumentum beat EPS estimates in each of the last 4 quarters, and its next earnings date is November 5, 2026.
Key risks and what to watch
- Total debt stands at $1.67B against $2.74B in cash and short-term investments as of June 30, 2026.
- Capital expenditures rose to $451.3M in FY2026 alongside R&D expenses of $356.5M, requiring sustained operational cash generation.
- Short interest represents 8.2% of the float, reflecting market skepticism despite 123.6% year-to-date returns.
- Return on equity over the trailing twelve months was -240.0%, reflecting ongoing profitability pressures.
AI-generated research summary. Written with AI from Quotelinks data as of October 16, 2026 and checked so every figure matches that data. For information only, not investment advice. Disclaimer
About this LITE AI stock analysis
This page is an AI-written research summary of Lumentum Holdings Inc. (LITE). The text was generated on October 30, 2026 from Quotelinks data as of October 16, 2026 (company profile, annual results, latest balance sheet, valuation, price performance and analyst estimates). An automatic check rejects any draft that contains a figure not found in that data. It is not investment advice; verify figures on the linked tabs before making decisions.
Related: LITE income statement, LITE balance sheet, LITE key metrics, LITE analyst forecast, LITE chart. See the LITE stock overview for the latest quote and news.
LITE AI stock analysis FAQ
Does Lumentum pay a dividend?
No, Lumentum does not pay a dividend. In FY2026, the company deployed capital toward $451.3M in capital expenditures and $102.0M in share buybacks.
When does Lumentum report its next earnings?
Lumentum is scheduled to report its next earnings on November 5, 2026. The company has beaten EPS estimates in each of the past 4 quarters.
What are analysts' price targets for LITE?
The mean price target for LITE is $1179.07, which is 43.1% above its last close of $824.13. Analyst recommendations consist of 17 Strong Buy, 5 Buy, and 4 Hold ratings.
How does Lumentum's valuation compare to its peers?
Lumentum trades at a forward P/E of 42.9x and an enterprise value to EBITDA of 114.9x. Both multiples trade at a premium to the median of its Nasdaq-100 Technology peers, which sit at 25.1x and 30.6x, respectively.