Jefferies analyst Blayne Curtis has maintained their bullish stance on LITE stock, giving a Buy rating on March 21.
Blayne Curtis has given his Buy rating due to a combination of factors that highlight Lumentum Holdings’ strategic positioning and growth potential. The company has revised its long-term model upwards, emphasizing opportunities in Optical Circuit Switches (OCS) and high-power lasers. Lumentum is expected to benefit from the transition to EMLs and the anticipated growth in the transceiver business, driven by the market’s demand for increased US capacity.
Additionally, the laser business is experiencing positive momentum with a significant increase in InP capacity, which is expected to continue growing and capturing market share at higher data rates. The potential for expansion into CW solutions and the insourcing of lasers for the Cloud Light business further strengthens Lumentum’s growth prospects. The company’s positioning in the OCS market, particularly with the potential outsourcing by major clients like Google, presents a significant upside. Overall, the revenue and profitability targets set by Lumentum are promising, despite some tempered expectations around AI.
In another report released on March 21, Raymond James also upgraded the stock to a Buy with a $82.00 price target.
LITE’s price has also changed slightly for the past six months – from $61.490 to $63.590, which is a 3.42% increase.