SAN JOSE, Calif., May 5, 2026, 09:13 (PDT)
- Stifel bumped its Lumentum price target up to $1,100, up from $800. Loop Capital took its own target higher as well, from $900 to $1,400, all ahead of the company’s fiscal third-quarter numbers.
- Lumentum will release results after the bell Tuesday. The company previously guided for revenue in the $780 million to $830 million range, with adjusted EPS between $2.15 and $2.35.
- The stock was changing hands around $1,016, after soaring 1,444.1% in the last year, according to 24/7 Wall St.
Shares of Lumentum Holdings jumped close to a new intraday high Tuesday, with analysts on Wall Street hiking their targets for the optical-networking supplier. Expectations are running high, even with the stock already factoring in a robust AI infrastructure cycle. Lumentum was last changing hands at $1,016.01, up roughly 4%, after peaking at $1,017.50.
The clock matters here. Lumentum drops its fiscal Q3 numbers after the bell, with investors eager to see if appetite for lasers, optical circuit switches, and co-packaged optics will keep fueling one of the hottest AI-driven runs out there.
Stifel’s Ruben Roy points to quicker capital outlays from hyperscalers—those major cloud firms ramping up AI data centers—and notes optical-networking suppliers now see 12 to 18 months of order visibility. Stifel’s forecast pegs 2026 capital spending for the “Big 5” hyperscalers at around $705.2 billion, which marks a 67.3% jump from the previous year. Investing.com
Stifel bumped up its price target for Lumentum to $1,100 from $800 and reiterated its Buy rating. The firm also moved price targets higher for Ciena and Coherent during the same sector call, putting Coherent at the top of its 12-month ranking among optical stocks, with Ciena second and Lumentum third.
Loop Capital boosted its Lumentum target sharply—now $1,400, up from $900—while sticking with its Buy call, reports from MarketBeat and MarketScreener show. That move piled onto a swift shift in sentiment before earnings.
The company’s February outlook was ambitious: it projected fiscal third-quarter revenue between $780 million and $830 million, a non-GAAP operating margin ranging from 30% to 31%, and non-GAAP diluted EPS of $2.15 to $2.35. Non-GAAP results exclude things like stock compensation, costs tied to acquisitions, and restructuring charges.
Last quarter set the tone for investors: Lumentum’s fiscal second-quarter revenue jumped 65.5% year-over-year to $665.5 million. GAAP net income hit $78.2 million, with non-GAAP earnings coming in at $1.67 per share. “Standout second quarter,” said Chief Executive Michael Hurlston, adding that the company was “only at the starting line” for optical circuit switches and co-packaged optics. Lumentum Investor Relations
These two product lines now sit at the heart of the stock story. Optical circuit switches move data around networks; co-packaged optics brings optical elements closer to the chip, cutting power loss and boosting bandwidth. Lumentum reported its optical circuit-switch backlog is “well beyond $400 million” and disclosed it landed another multi-hundred-million-dollar order for co-packaged optics, with delivery set for the first half of 2027. Lumentum Investor Relations
Nvidia’s involvement is adding serious weight to the trade. Back in March, the chipmaker put $2 billion into Lumentum through a nonexclusive deal—one that not only means a multibillion-dollar commitment to buy, but also secures future supply of high-end laser parts. Nvidia lined up a separate $2 billion investment in Coherent, opting not to lock in a single supplier and keeping its options open.
Lumentum is moving to boost its capacity. Back in March, the company announced plans for a 240,000-square-foot plant in Greensboro, North Carolina, targeting production of indium phosphide-based optical devices. The ramp-up is slated for mid-2028. Nvidia is on board as a customer for the new site, according to Lumentum.
The bullish sentiment isn’t just showing up in bank notes—investors on Seeking Alpha are piling in, too. In an April 27 post, one contributor pointed to Lumentum’s 1,300% rally over the past year and made the case that the company’s lasers are key for 1.6T and 3.2T data-center network expansions. The author is long the stock.
Still, there’s not much cushion for disappointment here. Lumentum trades at a lofty price-to-earnings ratio—close to 299—and is already above some analysts’ published targets. Any stumble, whether it’s delayed orders, thinner margins, or if laser supply tightens less than expected, and the AI-driven gains that fueled the rally could just as quickly reverse.
