Lumentum Holdings Inc. (LITE) can make a big difference with a little luck

Lumentum Holdings Inc. (NASDAQ: LITE) stock fell -2.52% on Friday to $91.08 against a previous-day closing price of $93.43. With 1.02 million shares changed hands, the volume of the stock remained heavier than its average volume of 0.86 million shares. During the session, the Communication Equipment company that operates in wider Technology sector, reached to the highest price of $93.37 whereas the lowest price it dropped to was $90.85. The 52-week range on LITE shows that it touched its highest point at $108.90 and its lowest point at $73.97 during that stretch. It currently has a 1-year price target of $112.82. Beta for the stock currently stands at 0.92.

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Price Performance and Earnings:

Stock performance is one of the indicators that investors use to determine whether they will profit from a stock. The price performance of LITE was up-trending over the past week, with a rise of 3.32%, but this was up by 18.39% over a month. Three-month performance surged to 1.77% while six-month performance fell -9.78%. The stock gained 11.54% in the past year, while it has lost -13.89% so far this year. A look at the trailing 12-month EPS for LITE yields 2.46 with Next year EPS estimates of 6.87. For the next quarter, that number is 1.33. This implies an EPS growth rate of 190.20% for this year and 16.04% for next year. EPS is expected to grow by 7.90% annually over the next five years; however, over the past five years, the company experienced an annual growth rate of 148.90%.

Float and Shares Shorts:

At present, 71.00 million LITE shares are outstanding with a float of 68.80 million shares on hand for trading. On Jul 14, 2022, short shares totaled 8.06 million, which was 11.68% higher than short shares on Jun 14, 2022. In addition to Mr. Alan S. Lowe as the firm’s Pres, CEO & Director, Mr. Wajid Ali B.A., C.M.A., M.A., M.B.A. serves as its Exec. VP & CFO.

Institutional Ownership:

Through their ownership of 101.51% of LITE’s outstanding shares, institutional investors have majority control over the company. Other institutions hold 8.62% of LITE, in contrast to 55.54% held by mutual funds. Shares owned by individuals account for 45.64%. As the largest shareholder in LITE with 13.98% of the stake, Wellington Management Co. LLP holds 9,643,188 shares worth 9,643,188. A second-largest stockholder of LITE, The Vanguard Group, Inc., holds 6,417,475 shares, controlling over 9.30% of the firm’s shares. BlackRock Fund Advisors is the third largest shareholder in LITE, holding 5,671,916 shares or 8.22% stake. With a 2.88% stake in LITE, the iShares Core S&P Mid Cap ETF is the largest stakeholder. A total of 1,987,467 shares are owned by the mutual fund manager. The Vanguard Total Stock Market Index, which owns about 2.80% of LITE stock, is the second-largest Mutual Fund holder. It holds 1,930,374 shares valued at 153.31 million. Hartford Mid Cap Fund holds 2.79% of the stake in LITE, owning 1,921,878 shares worth 152.64 million.

Analysts Ratings:

Reading analyst opinions is an effective way to decide where to invest, and there are several opinions available for LITE since 13 analysts follow the stock currently. There are 10 analysts who recommend BUY ratings, while 0 suggest SELL ratings. Of the remaining analysts, 1 believe that the stock is worth HOLDING, 2 give it an OVERWEIGHT rating, and 0 thinks that it’s UNDERWEIGHT. In the same way, a target price assigned to a stock can also reveal much about its potential. With LITE analysts setting a high price target of $125.00 and a low target of $94.00, the average target price over the next 12 months is $110.42. Based on these targets, LITE could surge 37.24% to reach the target high and rise by 3.21% to reach the target low. Reaching the average price target will result in a growth of 21.23% from current levels.

EPS: Estimates vs Actual

It is also common to use earnings estimates to evaluate a firm’s growth potential and to determine trading strategy. LITE will report FY 2022 earnings on 08/15/2023. Analysts have provided yearly estimates in a range of $5.98 being high and $5.81 being low. For LITE, this leads to a yearly average estimate of $5.91. The earnings surprise of a firm occurs when the actual results change from the consensus earnings estimate. Lumentum Holdings Inc. surprised analysts by $0.07 when it reported $1.19 EPS against a consensus estimate of $1.12. The surprise factor in the prior quarter was $0.02. Based on analyst estimates, the high estimate for the next quarter is $1.39 and the low estimate is $1.26. The average estimate for the next quarter is thus $1.33.

Summary of Insider Activity:

Insiders traded LITE stock several times over the past three months with 4 Buys and 8 Sells. In these transactions, 767 shares were bought while 22,939 shares were sold. The number of buy transactions has increased to 29 while that of sell transactions has risen to 51 over the past year. The total number of shares bought during that period was 270,772 while 253,919 shares were sold.

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