Upside case
Bull case
$407-56.9%
The bull case prices LITE at 52x on FY1 earnings, assuming continued execution and no meaningful deceleration in the core business.
Analysis OverviewBuyUpdated May 1, 2026
Lumentum Holdings Inc. (LITE) Stock Analysis
Wall Street verdict, consensus price target, and analyst rating breakdown — everything needed to frame the risk/reward at today's price.
Analyst consensus
Buy
Covering
24
analysts
17 bullish · 0 bearish · 24 covering LITE
Strong Buy
1
Buy
16
Hold
7
Sell
0
Strong Sell
0
Consensus Target
$643
-31.9% vs today
Scenario Range
— – $407
Model bear to bull value window
Coverage
24
Published analyst ratings
Valuation Context
121.0x
Forward P/E · Market cap $67.4B
LITE price targets
Three scenarios for where LITE stock could go
Current
~$944
Confidence
53 / 100
Updated
May 1, 2026
Where we are now
Current · $944
Base
$454
Bull
$407
Market caseClosest to today
Base case
$454-51.9%
At 58x on FY1 earnings, the base case reflects a reasonable but not stretched valuation. It prices in continued growth without assuming an exceptional setup.
Stress case
Bear case
—
The bear case reflects a scenario where earnings shortfalls or multiple compression combine to materially reduce the stock from its current level.
Not financial advice. Model confidence reflects internal scenario assumptions, not a guarantee of returns. Past performance does not predict future results.
Lumentum Holdings Inc.
LITE · NASDAQTechnologyCommunication EquipmentJune year-end
Lumentum is a manufacturer of optical and photonic components for telecommunications and industrial applications. It generates revenue primarily from its Optical Communications segment (~85% of sales) selling transceivers, amplifiers, and other fiber optic components, with the remainder from Commercial Lasers for materials processing and 3D sensing. The company's competitive advantage lies in its specialized photonics expertise and vertically integrated manufacturing capabilities for high-performance optical components.
Market Cap
$67.4B
Revenue TTM
$2.5B
Net Income TTM
$440M
Net Margin
17.7%
LITE Revenue and Earnings Performance
Quarterly beat-or-miss track record against analyst estimates, plus forward revenue and EPS outlook for the next two fiscal years.
EPS Beat Rate
92%Exceptional
12 quarters tracked
Revenue Beat Rate
83%Exceptional
vs consensus estimates
Avg EPS Surprise
+20.4%
above Street consensus
Beat / Miss Record
BeatMissLeft = EPS · Right = Revenue
Q2 2025
Q3 2025
Q4 2025
Q1 2026
Last 4 Quarters
EPS beats: 4 of 4Q2 2025
EPS
$0.57/$0.50
Revenue
$425M/$457M
Q3 2025
EPS
$0.88/$0.81
Revenue
$425M/$471M
Q4 2025
EPS
$1.10/$1.03
Revenue
$534M/$526M
Q1 2026
EPS
$1.67/$1.41
Revenue
$666M/$652M
| Quarter | EPS (Actual / Est) | EPS Surprise | Revenue (Actual / Est) | Rev Surprise |
|---|---|---|---|---|
| Q2 2025 | $0.57/$0.50 | +14.0% | $425M/$457M | -6.9% |
| Q3 2025 | $0.88/$0.81 | +8.1% | $425M/$471M | -9.6% |
| Q4 2025 | $1.10/$1.03 | +6.8% | $534M/$526M | +1.4% |
| Q1 2026 | $1.67/$1.41 | +18.4% | $666M/$652M | +2.1% |
FY1–FY2 Estimates
Revenue Outlook
FY1
$2.6B
+21.6% YoY
FY2
$3.4B
+32.0% YoY
EPS Outlook
FY1
$4.25
+48.4% YoY
FY2
$5.67
+33.4% YoY
Trailing FCF (TTM)$399M
FCF Margin: 16.0%
Next Earnings
—
Expected EPS
—
Expected Revenue
—
LITE beat EPS estimates in 4 of 4 tracked quarters. A perfect track record raises the bar for the upcoming report.
LITE Revenue Breakdown by Segment
Product and geographic revenue mix from the latest annual disclosure, with year-over-year growth by segment.
Latest disclosure
FY 2025
Total disclosed revenue $3.1B
Product Mix
Latest annual revenue by segment or product family
Segment breakdown not available for this company.
Geographic Mix
Latest annual revenue by reported region
Asia Pacific
32.0%
+28.3% YoY
Tap, hover, or focus a slice to inspect segment detail.
Asia Pacific is the largest reported region at 32.0%, up 28.3% YoY.
LITE Valuation Snapshot
Current multiples compared to the S&P 500, the company's sector, and its own five-year average.
Relative Value Signal
Significantly Overvalued
Fair value est. $200 — implies -78.9% from today's price.
Premium to Fair Value
78.9%
above fair value
Deep DiscountFair ValueVery Expensive
vs S&P 500 Trailing P/E
LITE
2552.1x
vs
S&P 500
25.2x
+10016% premium
vs Technology Trailing P/E
LITE
2552.1x
vs
Technology
27.5x
+9188% premium
vs LITE 5Y Avg P/E
Today
2552.1x
vs
5Y Average
30.1x
+8373% premium
Forward PE
121.0x
S&P 500
19.1x
+535%
Technology
21.7x
+458%
5Y Avg
—
—
Trailing PE
2552.1x
S&P 500
25.2x
+10016%
Technology
27.5x
+9188%
5Y Avg
30.1x
+8373%
PEG Ratio
—
S&P 500
1.75x
—
Technology
1.47x
—
5Y Avg
—
—
EV/EBITDA
907.4x
S&P 500
15.3x
+5850%
Technology
17.4x
+5124%
5Y Avg
23.3x
+3793%
Price/FCF
—
S&P 500
21.3x
—
Technology
19.8x
—
5Y Avg
33.7x
—
Price/Sales
41.0x
S&P 500
3.1x
+1208%
Technology
2.4x
+1598%
5Y Avg
3.1x
+1204%
Dividend Yield
—
S&P 500
1.88%
—
Technology
1.18%
—
5Y Avg
—
—
| Metric | LITE | S&P 500 | Technology | 5Y Avg LITE |
|---|---|---|---|---|
| Forward PE | 121.0x | 19.1x+535% | 21.7x+458% | — |
| Trailing PE | 2552.1x | 25.2x+10016% | 27.5x+9188% | 30.1x+8373% |
| PEG Ratio | — | 1.75x | 1.47x | — |
| EV/EBITDA | 907.4x | 15.3x+5850% | 17.4x+5124% | 23.3x+3793% |
| Price/FCF | — | 21.3x | 19.8x | 33.7x |
| Price/Sales | 41.0x | 3.1x+1208% | 2.4x+1598% | 3.1x+1204% |
| Dividend Yield | — | 1.88% | 1.18% | — |
LITE trades above S&P 500 benchmarks on 4 of 4 measured multiples — commands a broad premium across most valuation dimensions.
Forward P/E and PEG reflect analyst consensus estimates. Historical averages use trailing ratios where forward data is unavailable.S&P 500 and sector benchmarks both use trailing median P/E — similar readings indicate the broader index and sector are priced alike.
Open valuation toolLITE Financial Health
Verdict
Adequate
LITE generates $399M in free cash flow at a 16.0% margin.
Cash Engine
Revenue, margins, and cash generation
Revenue (TTM)
Trailing-twelve-month sales base
$2.5B
Revenue Growth
TTM vs prior year
+69.0%
Gross Margin
Gross profit as a share of revenue
37.7%
Operating Margin
Operating income divided by revenue
9.5%
Net Margin
Net income divided by revenue
17.7%
EPS (TTM)
Diluted earnings per share, trailing twelve months
$4.57
Free Cash Flow (TTM)
Cash generation after capex
$399M
FCF Margin
FCF as share of revenue — the primary cash quality signal
16.0%
Capital Quality
ROIC, leverage, and debt serviceability
ROIC
Return on invested capital — primary competitive quality signal
-4.3%
ROA
Return on assets, trailing twelve months
8.5%
Cash & Equivalents
Liquid assets on the balance sheet
$521M
Net Debt
Total debt minus cash
$2.1B
Debt Serviceability
Net debt as a multiple of annual free cash flow
5.2× FCF
~5.2 years to full repayment at current FCF run-rate
ROE *
Return on equity, trailing twelve months
30.7%
* Elevated by buyback-compressed equity — compare ROIC (-4.3%) for an undistorted picture of capital efficiency.
Shareholder Returns
How capital is returned to owners
Total shareholder yield
0.1%
Dividend
—
Buyback
0.1%
Share Repurchases
Trailing buyback outflow — dollar magnitude of capital returned
$42M
Dividend / Share
Annualized trailing dividend per share
—
Payout Ratio
Share of earnings distributed as dividends
—
Shares Outstanding
Declining as buybacks retire shares
71M
All figures from the trailing twelve months. ROIC uses invested capital (equity + net debt). ROE marked * where buyback-compressed equity base may inflate the figure.
Open full ratios pageLITE Stock Risk Factors
Key factors that could pressure the stock price, compress the multiple, or weigh on future results.
AI analysis · updated April 11, 2026
High Risk
Valuation Risk
Lumentum trades at high multiples, with analysts noting it is priced for perfection. A failure to meet growth expectations could trigger a significant market correction.
Medium
Customer Concentration
A large portion of revenue comes from a handful of hyperscale customers. Loss of any key client could erode market share and compress pricing power.
Medium
Supply Chain Constraints
Persistent semiconductor shortages and the complexity of producing 200G EML chips may delay product delivery and inflate costs, impacting earnings forecasts.
Medium
Capital Structure Dilution
The company holds substantial convertible debt. If converted, it could dilute existing shareholders and pressure earnings per share.
Medium
Competitive Pressure
Lumentum faces rivals such as Coherent, Broadcom, and Marvell offering integrated solutions, potentially eroding its high-end EML laser market share.
Lower
Market Sentiment & Technical Risk
Recent price declines have been amplified by algorithmic and stop‑loss selling, indicating sensitivity to market sentiment and technical triggers.
These are risk mechanisms, not predictions. The key question is which would force a cut to earnings estimates or a lower multiple than the market currently prices in.
Why LITE Stock Could Outperform
Structural drivers behind the upside case and why the stock could outperform over the next 12 months.
AI analysis · updated April 11, 2026
AI & Cloud Data Center Demand Surge
Lumentum’s optical and photonic products are essential for the bandwidth demands of AI and cloud infrastructure, as copper limitations are being surpassed by the need for faster optical solutions. The company’s order pipeline is reportedly booked through 2028, driven by AI infrastructure demand from major U.S. cloud providers.
Nvidia $2B Strategic Investment
A significant $2 billion strategic investment from Nvidia, coupled with multi‑billion‑dollar purchase commitments, positions Lumentum as a key supplier in the AI ecosystem. This partnership transforms Lumentum from a cyclical supplier to a strategic asset.
Projected Revenue & Margin Expansion
Analysts anticipate revenue growth to $1.25 billion in 9–12 months and $2 billion in 18–24 months, targeting operating margins of 40%. Recent financial reports show strong year‑over‑year revenue growth and margin expansion.
Capacity Expansion & Product Innovation
Lumentum is expanding manufacturing capacity with a new facility in North Carolina to produce advanced optical devices for AI data centers. The company is also seeing strong demand for its 200 G EMLs and advancing in optical circuit switching (OCS) and co‑packaged optics (CPO).
A real bull case compounds — each driver matters most when it strengthens margins, supports capital returns, and keeps the company above the market's minimum growth bar simultaneously.
LITE Stock Price Performance
52-week range context and price returns across multiple time horizons. Dividend contribution is shown separately in the Capital Return section.
Current Price
$944.28
52W Range Position
92%
52-Week Range
Current price plotted between the 52-week low and high.
52-Week Low
$60.38
+1463.9% from the low
52-Week High
$1021.00
-7.5% from the high
1 Month
+22.27%
3 Month
+71.07%
YTD
+144.6%
1 Year
+1365.8%
3Y CAGR
+170.2%
5Y CAGR
+63.3%
10Y CAGR
+44.1%
Range context matters because valuation compression and earnings misses rarely hit from the same starting point. A stock already far below its high can still fall, but it is no longer carrying the same embedded optimism as one pressing a fresh peak.
LITE vs Peers
Valuation, growth, and margin comparison against the closest publicly traded peers for this company.
Peer Set
Accurate peer set
Forward PE
121.0x
vs 64.2x median
+88% above peer median
Revenue Growth
+21.6%
vs +15.7% median
+37% above peer median
Net Margin
17.7%
vs 2.8% median
+537% above peer median
| Company | Mkt Cap | Fwd PE | Rev Grw | Margin | Rating | Upside |
|---|---|---|---|---|---|---|
LIT LITE Lumentum Holdings Inc. | $67.4B | 121.0x | +21.6% | 17.7% | Buy | -31.9% |
COH COHR Coherent, Inc. | $54.7B | 64.2x | +18.1% | 10.6% | Buy | -26.7% |
AAO AAOI Applied Optoelectronics, Inc. | $14.1B | 189.4x | +47.1% | -8.4% | Buy | -74.2% |
IPG IPGP IPG Photonics Corporation | $4.3B | 62.8x | -0.6% | 2.8% | Buy | +48.8% |
VIA VIAV Viavi Solutions Inc. | $12.3B | 57.3x | +3.7% | -4.0% | Buy | -39.2% |
CIE CIEN Ciena Corporation | $81.6B | 93.8x | +15.7% | 4.5% | Buy | -42.1% |
This peer comparison reflects companies with similar business models, product lines, or market positioning, supplemented by industry grouping when direct matches are limited.
LITE Dividend and Capital Return
LITE does not currently return meaningful capital to shareholders.
Dividend UnknownFCF Unknown
Total Shareholder Yield
0.1%
Dividend + buyback return per year
Buyback Yield
0.1%
Dividend Yield
—
Payout Ratio
—
Dividend Profile
Yield, cadence, and growth quality
Dividend / Share
Trailing annualized cash dividend
$0.00
Growth Streak
Consecutive years of dividend increases
0Y
3Y Div CAGR
—
5Y Div CAGR
—
Ex-Dividend Date
—
Payment Cadence
—
0 payments over the last 12 months
Buyback Engine
How much per-share support comes from repurchases
Repurchases (TTM)
Cash used for buybacks in the latest trailing period
$42M
Estimated Shares Retired
44.2K
Approx. Share Reduction
0.1%
Shares Outstanding
Current diluted share count from the screening snapshot
71M
FAQ
7 questionsLITE Investor Questions
Common questions answered from live analyst data and company financials.
01Is Lumentum Holdings Inc. (LITE) stock a buy or sell in 2026?
Lumentum Holdings Inc. (LITE) is rated Buy by Wall Street analysts as of 2026. Of 24 analysts covering the stock, 17 rate it Buy or Strong Buy, 7 rate it Hold, and 0 rate it Sell or Strong Sell. The consensus 12-month price target is $643, implying -31.9% from the current price of $944.
02What is the LITE stock price target for 2026?
The Wall Street consensus price target for LITE is $643 based on 24 analyst estimates. The high-end target is $1270 (+34.5% from today), and the low-end target is $240 (-74.6%). The base case model target is $454.
03Is Lumentum Holdings Inc. (LITE) stock overvalued in 2026?
LITE trades at 121.0x times forward earnings. The stock trades at a notable premium to the broad market, which is typical for businesses with strong free cash flow and above-average growth expectations. Based on current multiples versus the peer group, the relative model signals significantly overvalued. Whether the stock is over or undervalued ultimately depends on whether consensus earnings estimates are achievable.
04What are the main risks for Lumentum Holdings Inc. (LITE) stock in 2026?
The primary risks for LITE in 2026 are: (1) Valuation Risk — Lumentum trades at high multiples, with analysts noting it is priced for perfection. (2) Customer Concentration — A large portion of revenue comes from a handful of hyperscale customers. (3) Supply Chain Constraints — Persistent semiconductor shortages and the complexity of producing 200G EML chips may delay product delivery and inflate costs, impacting earnings forecasts. Each factor has the potential to pressure earnings or compress the stock's valuation multiple.
05What is Lumentum Holdings Inc.'s revenue and earnings forecast?
Analyst consensus estimates LITE will report consensus revenue of $2.6B (+21.6% year-over-year) and EPS of $4.25 (+48.4% year-over-year) for the upcoming fiscal year. The following year, analysts project $3.4B in revenue.
06When does Lumentum Holdings Inc. (LITE) report its next earnings?
A confirmed upcoming earnings date for LITE is not yet available. Check the Earnings section above for the most recent quarterly report dates and forward estimates.
07How much free cash flow does Lumentum Holdings Inc. generate?
Lumentum Holdings Inc. (LITE) generated $399M in free cash flow over the trailing twelve months — a free cash flow margin of 16.0%. LITE returns capital to shareholders through and share repurchases ($42M TTM).