Lumentum Holdings Inc. (LITE) — Fundamental Analysis & Key Financial Ratios

Kaplio's reading: Lumentum Holdings Inc.

Updated on October 26, 2026 · accounts published on August 11, 2026

Reading of October 23, 2026: A fast-growing business whose operating gains are swallowed by losses below the operating line

Lumentum's revenue grew 83 % over the last 12 months, lifting its operating margin to 17 %, six times its 2015-2026 average of 2.9 %.

• Is Lumentum expensive or cheap? After a 349 % rise in 12 months, Lumentum trades 33 % below its 52-week high, with a free cash flow yield of only 0.3 %.
• How is the business doing? Revenue grew 83 % over the last 12 months and the operating margin reached 17 %, against a 2.9 % average for fiscal 2015-2026.
• How strong is the balance sheet? Net debt is just 0.1× EBITDA in fiscal 2026, with net cash of $14.01 per share and an Altman Z-score of 13.2.
• Does Lumentum grow with real cash or by diluting shareholders? Free cash flow was 10 % of fiscal 2026 revenue, half the 20 % tech benchmark, while stock-based pay stays low at 5.6 %.
• What to expect from the next earnings? Lumentum reports on November 5, 2026, and analysts expect EPS of $4.22 after eight straight quarters of beating estimates.

Is Lumentum expensive or cheap?

Over the last 12 months the stock has gained 349 %. It climbed from a 52-week low of $168.50 to a high of $1,133.40 and now sits 33 % below that peak. Even after the pullback, the price asks a lot of the future. The free cash flow yield over the last 12 months is 0.3 %, so each $100 invested buys about 30 cents of annual free cash. Price to book is 12.1×. Those figures only hold up if the recent jump in revenue and margins proves lasting, which leaves little room for disappointment.

How is the business doing?

Lumentum is growing fast. Revenue rose 83 % over the last 12 months, and the 17.4 % operating margin in fiscal 2026 is six times its twelve-year average of 2.9 %. The bottom line looks very different. Over the last 12 months the net margin is −230 % and ROE is −300 %, so large losses below the operating line wipe out what the core business earns. Return on invested capital over the last 12 months is 7.9 %, 0.3 points below the median of 456 sector peers. It has topped 10 % in only one of the last ten fiscal years, and its worst year was 2024 at −9.8 %.

How strong is the balance sheet?

The balance sheet is the calmest part of the story. At the end of fiscal 2026 Lumentum held $36.71 of cash per share against $22.69 of debt, leaving net cash of $14.01 per share. That cushion covers only 1.9 % of the current price. Net debt is 0.1× EBITDA, far below the 2.0× that telecom equipment makers can tolerate. Over the last 12 months debt to equity is 0.36, the current ratio is 1.68 and the Altman Z-score of 13.2 sits deep in the safe zone. The Piotroski score of 5 out of 9 is only middling.

Does Lumentum grow with real cash or by diluting shareholders?

In technology, generic ratios fall short. What decides whether shareholders keep what the business earns is growth, pricing power and dilution through stock-based pay. Lumentum passes most of these tests. Revenue per share grew 16.0 % a year in fiscal 2023-2026, just above the 15 % healthy mark. The 41.7 % gross margin in fiscal 2026 clears the 35 % bar for telecom equipment, and stock-based pay equals 5.6 % of revenue, well under the 10 % limit. Turning sales into cash is the weak spot. Free cash flow was 10.0 % of revenue in fiscal 2026, half the 20 % benchmark, and ROIC of 7.9 % falls short of 15 %.

What to expect from the next earnings?

Lumentum reports on November 5, 2026, and analysts expect EPS of $4.22 for the quarter. On August 11, 2026 the company delivered $3.23, beating the $2.97 estimate by 8.8 %, and it has topped EPS forecasts in each of the last 8 quarters. Expectations keep edging up. Over the last 30 days the 2027 EPS consensus rose 1.1 %, from $21.55 to $21.78 across 15 analysts, and the 2027 revenue consensus rose 1.4 %. Of the 25 analysts covering the stock, 17 rate it a buy, 7 a hold and none a sell.

How this was prepared: the data comes from companies' official filings, collected by a professional provider, and from Kaplio's analysis engine (trailing-12-month ratios, 10 years of history and sector medians computed across US-listed companies). The text is written from that data alone, every figure is checked against it before publication, and it is reviewed when the company reports results. This is not investment advice.