Latest Ratios: P/E Ratio 2555.9x · EV/EBITDA 1173.0x · ROE 2.5%. (2013–2025 historical series)
Price-based multiples — how expensive the stock is relative to earnings, sales, book value, and cash flow
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Market Cap | $73.6B | $6.6B | $3.4B | $3.9B | $5.9B | $6.1B | $5.9B | $3.8B | $3.7B | $3.5B | $1.5B |
| Enterprise Value | $75.7B | $8.7B | $5.5B | $5.9B | $6.5B | $6.6B | $6.8B | $4.2B | $3.6B | $3.5B | $1.3B |
| P/E Ratio → | 2555.86 | 256.08 | — | — | 29.63 | 30.61 | 43.50 | — | 15.16 | — | — |
| P/S Ratio | 44.73 | 4.01 | 2.52 | 2.19 | 3.44 | 3.55 | 3.52 | 2.41 | 2.94 | 3.45 | 1.64 |
| P/B Ratio | 58.01 | 5.81 | 3.58 | 2.86 | 3.14 | 3.09 | 3.38 | 2.52 | 3.81 | 5.28 | 2.78 |
| P/FCF | — | — | — | 75.53 | 16.01 | 9.45 | 13.48 | 23.01 | 23.75 | — | 321.97 |
| P/OCF | 582.53 | 52.21 | 138.74 | 21.55 | 12.83 | 8.24 | 11.27 | 11.44 | 14.81 | 40.67 | 17.10 |
P/E links to full P/E history page with 30-year chart
Enterprise-value multiples — capital-structure-neutral measures of total business value
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| EV / Revenue | — | 5.28 | 4.08 | 3.33 | 3.82 | 3.83 | 4.05 | 2.67 | 2.89 | 3.50 | 1.47 |
| EV / EBITDA | 1173.03 | 134.61 | — | 42.10 | 13.90 | 13.93 | 17.17 | 30.79 | 16.63 | 32.25 | 20.03 |
| EV / EBIT | — | — | — | — | 20.74 | 20.78 | 28.87 | 1394.93 | 24.46 | — | 135.10 |
| EV / FCF | — | — | — | 114.80 | 17.76 | 10.18 | 15.51 | 25.50 | 23.39 | — | 287.81 |
Margins and return-on-capital ratios measuring operating efficiency
Full margin charts and quarterly trend are on the Earnings History page
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Gross Margin | 28.0% | 28.0% | 18.5% | 32.2% | 46.0% | 46.0% | 38.7% | 27.2% | 34.6% | 31.8% | 30.7% |
| Operating Margin | -11.7% | -11.7% | -26.6% | -6.5% | 17.7% | 17.7% | 12.2% | -1.4% | 11.2% | 4.8% | 1.3% |
| Net Profit Margin | 1.6% | 1.6% | -40.2% | -7.4% | 11.6% | 11.6% | 8.1% | -2.3% | 19.9% | -10.2% | 1.0% |
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| ROE | 2.5% | 2.5% | -47.3% | -8.1% | 10.3% | 10.7% | 8.3% | -3.0% | 30.7% | -17.3% | 2.0% |
| ROA | 0.6% | 0.6% | -12.8% | -3.0% | 5.2% | 5.8% | 4.5% | -1.7% | 17.6% | -10.5% | 1.5% |
| ROIC | -4.6% | -4.6% | -8.4% | -2.9% | 9.2% | 9.0% | 6.7% | -1.2% | 13.1% | 6.6% | 2.3% |
| ROCE | -5.1% | -5.1% | -9.4% | -3.1% | 9.6% | 10.3% | 7.5% | -1.1% | 11.6% | 5.9% | 2.4% |
Solvency and debt-coverage ratios — lower is generally safer
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Debt / Equity | 2.30 | 2.30 | 2.67 | 2.12 | 1.03 | 0.63 | 0.68 | 0.56 | 0.36 | 0.49 | — |
| Debt / EBITDA | 40.44 | 40.44 | — | 20.54 | 4.12 | 2.64 | 3.00 | 6.19 | 1.57 | 2.92 | — |
| Net Debt / Equity | — | 1.84 | 2.22 | 1.49 | 0.34 | 0.24 | 0.51 | 0.27 | -0.06 | 0.07 | -0.29 |
| Net Debt / EBITDA | 32.36 | 32.36 | — | 14.40 | 1.37 | 0.99 | 2.25 | 3.01 | -0.26 | 0.41 | -2.38 |
| Debt / FCF | — | — | — | 39.27 | 1.75 | 0.72 | 2.03 | 2.49 | -0.36 | — | -34.15 |
| Interest Coverage | -6.75 | -6.75 | -11.00 | -1.88 | 3.93 | 3.93 | 3.85 | 0.08 | 8.11 | -9.87 | 98.00 |
Short-term solvency ratios and asset-utilisation metrics
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Current Ratio | 4.37 | 4.37 | 5.90 | 4.38 | 4.38 | 3.67 | 7.24 | 4.53 | 5.27 | 5.05 | 2.82 |
| Quick Ratio | 3.18 | 3.18 | 4.43 | 3.74 | 4.03 | 3.37 | 6.58 | 3.76 | 4.55 | 4.26 | 2.24 |
| Cash Ratio | 2.23 | 2.23 | 3.29 | 3.18 | 3.56 | 2.93 | 5.49 | 2.61 | 3.32 | 3.01 | 0.90 |
| Asset Turnover | — | 0.39 | 0.35 | 0.38 | 0.41 | 0.48 | 0.51 | 0.58 | 0.79 | 0.81 | 1.24 |
| Inventory Turnover | 2.52 | 2.52 | 2.78 | 2.93 | 3.69 | 4.70 | 5.44 | 4.98 | 5.31 | 4.71 | 6.22 |
| Days Sales Outstanding | — | 55.47 | 52.28 | 50.84 | 55.84 | 45.35 | 50.77 | 55.50 | 57.66 | 60.60 | 68.92 |
Earnings, FCF, buyback, and dividend yields — total returns to shareholders
Full dividend history and growth charts are on the Dividend History page
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Dividend Yield | — | — | — | — | — | — | — | 0.0% | 0.0% | 0.0% | 0.0% |
| Payout Ratio | — | — | — | — | — | — | — | — | — | — | 5.4% |
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings Yield | 0.0% | 0.4% | — | — | 3.4% | 3.3% | 2.3% | — | 6.6% | — | — |
| FCF Yield | — | — | — | 1.3% | 6.2% | 10.6% | 7.4% | 4.3% | 4.2% | — | 0.3% |
| Buyback Yield | 0.1% | 0.6% | 0.0% | 4.5% | 9.2% | 4.5% | 3.4% | 0.0% | 0.0% | 0.0% | 0.0% |
| Total Shareholder Yield | 0.1% | 0.6% | 0.0% | 4.5% | 9.2% | 4.5% | 3.4% | 0.0% | 0.0% | 0.0% | 0.0% |
| Shares Outstanding | — | $70M | $67M | $68M | $74M | $74M | $78M | $71M | $63M | $61M | $61M |
Includes 30+ ratios · 13 years · Updated daily
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Quick answers to the most common questions about buying LITE stock.
Lumentum Holdings Inc.'s current P/E ratio is 2555.9x. The historical average is 29.7x. This places it at the 100th percentile of its historical range.
Lumentum Holdings Inc.'s current EV/EBITDA is 1173.0x. This enterprise value multiple compares the company's total value (equity + debt - cash) to its EBITDA. The historical average is 23.3x.
Lumentum Holdings Inc.'s return on equity (ROE) is 2.5%. The historical average is -0.5%.
Based on historical data, Lumentum Holdings Inc. is trading at a P/E of 2555.9x. This is at the 100th percentile of its historical P/E range. Compare with industry peers and growth rates for a complete picture.
Lumentum Holdings Inc. has 28.0% gross margin and -11.7% operating margin.
Lumentum Holdings Inc.'s Debt/EBITDA ratio is 40.4x, indicating high leverage. A ratio above 4x may signal elevated financial risk.
Key Metrics
Top Statement Risk
Leverage amid operational losses
Metrics are mathematically derived from official filings.
Valuation Reflects AI Optionality, Not Current Earnings
Lumentum's forward P/E of 108.81 and EV/EBITDA of 75.58, as reported in recent market data, price in a significant earnings recovery that is not yet reflected in its trailing metrics, suggesting the market is valuing future AI-driven growth over current operational weakness.
The extreme disconnect between the trailing P/E of 2,418.92 and the forward multiples indicates the market is pricing a dramatic earnings inflection, likely tied to the AI data center cycle. This valuation premium appears to assume successful execution on next-generation products like 1.6T transceivers and a rapid return to profitability, leaving little room for execution missteps or a delay in the anticipated demand surge. Compared to peers like Coherent (COHR), LITE's multiples suggest a higher growth expectation, which must be validated by sustained order momentum.
Gross Margin Recovery Masks Structural Operating Losses
Despite a sharp recovery in gross margin to 47.4% in Q4 FY2026, Lumentum's operating margin remains negative at -11.7% for the full year, indicating that high fixed costs and integration expenses are overwhelming the benefits of improved product mix and volume.
The gross margin expansion from a trough of 16.6% in Q4 FY2024 to 47.4% demonstrates the powerful operating leverage inherent in the business model as utilization improves. However, the persistent negative operating margin suggests that the current revenue scale is insufficient to cover the full burden of R&D, SG&A, and acquisition-related amortization. This implies that true earning power is currently masked by structural overhead, and a sustained volume recovery is critical to unlock profitability.
Capital Returns Turn Positive but Remain Below Cost
Lumentum's ROIC has inflected to 5.1% in Q4 FY2026 from negative levels, yet this remains well below the company's estimated weighted average cost of capital, suggesting the business is not yet creating shareholder value on a risk-adjusted basis.
The swing from a negative ROIC to 5.1% is a positive signal that the cyclical trough has passed and the company is generating returns on its invested capital. However, this level is still inadequate for a technology company with significant capital intensity, indicating that the current earnings power is not sufficient to justify the capital deployed. The improvement appears driven by margin recovery rather than asset efficiency, as asset turnover has only marginally increased.
Working Capital Efficiency Improves but Remains Lumpy
The cash conversion cycle has improved to 75 days in Q4 FY2026 from a peak of 169 days in Q3 FY2024, driven primarily by a reduction in days inventory outstanding, which suggests better inventory management amid recovering demand.
The significant compression in the CCC is a constructive sign, indicating that the company is converting inventory and receivables into cash more efficiently. However, the volatility in this metric over the past ten quarters highlights the lumpy, project-driven nature of the business, where working capital can swing dramatically based on the timing of large orders. The current DSO of 44 days suggests reasonable collection efficiency, but the high DIO of 114 days indicates that inventory levels remain elevated relative to sales, posing a risk if demand softens.
Debt Reduction Improves Profile, But Coverage Remains Weak
Lumentum's debt-to-equity ratio has improved to 0.36 in Q4 FY2026 from a peak of 4.20, yet the interest coverage ratio is deeply negative at -2070.75, indicating that operating earnings are currently insufficient to service interest expenses.
The sharp deleveraging, likely from an equity raise, has significantly improved the balance sheet's structural risk profile. However, the negative interest coverage is a critical red flag, as it means the company is not generating enough operating income to cover its interest payments, relying on cash reserves or external financing. This situation is unsustainable and underscores the urgency for the anticipated earnings recovery to materialize; otherwise, the debt load could become a material constraint.
The Misleading Power of the P/E Multiple
The most commonly misapplied ratio to Lumentum is the trailing P/E, which at 2,418.92 is meaningless due to near-zero earnings and obscures the company's true cyclical recovery trajectory and asset-intensive business model.
Investors focusing on the trailing P/E will draw incorrect conclusions about valuation, as the metric is distorted by a period of significant losses and does not reflect the forward earnings power implied by the recent beat-and-raise guidance. A more appropriate metric is the forward EV/EBITDA, which captures the expected earnings recovery and accounts for the company's capital structure. Alternatively, analyzing gross margin trends and fab utilization rates provides a better leading indicator of the business's fundamental health than any single earnings-based multiple.