Lumentum rises after BofA upgrades following Q4 results

[Lumentum Corporate Headquarters in San Jose, California, USA]
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Shares of Lumentum (NASDAQ:LITE [https://seekingalpha.com/symbol/LITE]) rose about 6% on Wednesday after its fourth quarter results and outlook, and a rating upgrade at BofA.

BofA upgraded Lumentum's rating to Neutral from Underperform and raised the price target on the stock to $135 from $78.

Analysts led by Vivek Arya said that Lumentum's results indicate the possibility of hitting both its medium-term ($600M/quarter) and longer-term ($750M/quarter) revenue run-rate two-to-three quarters in advance of BofA's prior model.

"Under its relatively new CEO, LITE is refocusing back to its best-of-breed optical component (high-speed lasers, optical circuit switches) roots while prudently managing its lower margin optical transceiver mix. The result is a faster path towards achieving or beating the target 40% GM [gross margin]," said the analysts.

The fourth quarter results [https://seekingalpha.com/news/4484115-lumentum-takes-advantage-of-ai-data-center-demand-shares-rise-on-q4-results] of Lumentum, which makes optical networking products, surpassed analysts expectations and provided a first quarter revenue outlook [https://seekingalpha.com/news/4484123-lumentum-non-gaap-eps-of-0_88-beats-by-0_07-revenue-of-480_7m-beats-by-10_78m] which was seen above estimates.

MORE ON LUMENTUM

* Lumentum Holdings Inc. 2025 Q4 - Results - Earnings Call Presentation [https://seekingalpha.com/article/4812896-lumentum-holdings-inc-2025-q4-results-earnings-call-presentation]
* Lumentum Holdings Inc. (LITE) Q4 2025 Earnings Call Transcript [https://seekingalpha.com/article/4812895-lumentum-holdings-inc-lite-q4-2025-earnings-call-transcript]
* Why Lumentum Is A Buy After Third Quarter Earnings [https://seekingalpha.com/article/4793529-lumentum-buy-after-third-quarter-earnings]
* Lumentum targets $600M quarterly revenue by June 2026 amid accelerating AI-driven demand [https://seekingalpha.com/news/4484377-lumentum-targets-600m-quarterly-revenue-by-june-2026-amid-accelerating-ai-driven-demand]
* Lumentum takes advantage of AI data center demand, shares rise on Q4 results [https://seekingalpha.com/news/4484115-lumentum-takes-advantage-of-ai-data-center-demand-shares-rise-on-q4-results]