Not a good buy right now for an impatient buyer: the stock is extended (RSI extremely overbought) after an earnings-driven surge, and near-term pattern probabilities skew negative (next week/month).
Fundamentals/news are strong (AI optics demand + raised guidance), and Wall Street targets moved sharply higher, but the current price is already above several fresh targets and close to resistance.
Best call today: hold/avoid chasing here; the risk/reward is unfavorable at this entry given stretched technicals, elevated IV, and insider selling pressure.
Technical Analysis
Trend is strongly bullish: moving averages are stacked SMA_5 > SMA_20 > SMA_200, confirming a powerful uptrend.
However, price is overheated: RSI(6) = 85.264 (overbought), which commonly precedes pullbacks or consolidation.
Key levels: Pivot 406.59 (major reference), R1 ~474.32 already broken, next resistance R2 ~516.16; current price (492) sits between R1 and R2, a zone where upside can slow.
Statistical/analog pattern read: ~70% chance of only ~+0.24% next day, but -3.22% next week and -5.29% next month suggests near-term mean reversion risk after the spike.
Options Data
Bullish
Open Interest Put-Call Ratio
Neutral
Option Volume Put-Call Ratio
Positioning (OI): Put/Call OI = 0.75 implies more call open interest than puts (mildly bullish bias).
Flow (volume): Put/Call volume = 0.98 is close to neutral (puts and calls trading in similar size).
Event-driven regime: options activity is extremely elevated (today volume vs 30D avg ~272%), consistent with post-earnings repositioning.
Volatility is very high: 30D IV ~101% vs historical vol ~89.65%; IV percentile ~88.8 / IV rank ~70.9 → premiums are expensive and typically coincide with “big move already happened” conditions.
Takeaway: sentiment is not bearish, but the high-IV environment and neutral volume mix suggest the easy upside may be behind the initial earnings gap; near-term chop/pullback risk is elevated.
Technical Summary
Sell
5
Buy
10
Positive Catalysts
Earnings and guidance catalyst: fiscal Q2 results and outlook were described as “blowout/strong,” tied to accelerating AI infrastructure/optics demand.
Analysts broadly raised targets (multiple firms moved PTs into the ~480–565 range) citing AI optics, optical circuit switching (OCS) growth, and longer runway (CPO scale-out/scale-up narratives).
Trading trends show hedge funds buying aggressively (+673.52% QoQ), supportive for momentum continuation over time.
Neutral/Negative Catalysts
increases odds of a near-term pullback or consolidation.
Financial Performance
Latest quarter: Fiscal 2026/Q2.
Revenue growth is exceptional: $665.5M, +65.46% YoY (clear acceleration tied to AI-driven demand).
Profitability optics are mixed: Net Income and EPS shown as 0 (down 100% YoY) in the snapshot (could reflect non-GAAP/GAAP differences or one-time impacts, but as provided it’s a negative datapoint).
Operating quality improving at the gross level: Gross margin 38.02%, +53.55% YoY, consistent with stronger mix/scale.
Growth
Profitability
Efficiency
Analyst Ratings and Price Target Trends
Clear upward trend in Street views (past 2 days): widespread price-target raises and mostly bullish ratings maintained.
Bull case (pros): Citi/JPM/Needham/Mizuho/Susquehanna/Stifel/B. Riley cite AI optics demand, robust guidance, expanded capacity/visibility, and multi-year catalysts (OCS now; CPO later) with targets largely ~525–565 on the high end.
Cautious case (cons): Barclays stays Equal Weight (PT 475) and UBS/BofA remain Neutral (PTs 455 and 520), commonly pointing to valuation being less forgiving after the spike.
Net: Wall Street tone is strongly constructive on the business, but not uniformly constructive on today’s entry price.
Wall Street analysts forecast LITE stock price to fall over the next 12 months. According to Wall Street analysts, the average 1-year price target for LITE is 303.36 USD with a low forecast of 147 USD and a high forecast of 470 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
14 Analyst Rating
Wall Street analysts forecast LITE stock price to fall over the next 12 months. According to Wall Street analysts, the average 1-year price target for LITE is 303.36 USD with a low forecast of 147 USD and a high forecast of 470 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
9 Buy
5 Hold
0 Sell
Moderate Buy
Current: 504.420
Low
147
Averages
303.36
High
470
Current: 504.420
Low
147
Averages
303.36
High
470
Barclays
Tom O'Malley
Equal Weight
maintain
$365 -> $475
AI Analysis
2026-02-05
New
Reason
Barclays
Tom O'Malley
Price Target
$365 -> $475
AI Analysis
2026-02-05
New
maintain
Equal Weight
Reason
Barclays analyst Tom O'Malley raised the firm's price target on Lumentum to $475 from $365 and keeps an Equal Weight rating on the shares. The company's quarter topped even bullish expectations, the analyst tells investors in a research note.
Citi
Papa Sylla
Buy
maintain
$450 -> $560
2026-02-05
New
Reason
Citi
Papa Sylla
Price Target
$450 -> $560
2026-02-05
New
maintain
Buy
Reason
Citi analyst Papa Sylla raised the firm's price target on Lumentum to $560 from $450 and keeps a Buy rating on the shares post the earnings report. The firm says consensus estimates are not fully reflecting Lumentum's AI growth potential.
Unlock Full Analyst Thesis， Get the complete breakdown of rating reason for LITE
