Contrasting Lumentum (LITE) and Its Rivals

Lumentum (NASDAQ:LITE) is one of 110 public companies in the “Communications Equipment” industry, but how does it weigh in compared to its rivals? We will compare Lumentum to related businesses based on the strength of its analyst recommendations, institutional ownership, valuation, profitability, dividends, risk and earnings.

Institutional & Insider Ownership

94.1% of Lumentum shares are held by institutional investors. Comparatively, 44.4% of shares of all “Communications Equipment” companies are held by institutional investors. 0.3% of Lumentum shares are held by insiders. Comparatively, 18.4% of shares of all “Communications Equipment” companies are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Profitability

This table compares Lumentum and its rivals’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Lumentum	-175.82%	28.85%	14.24%
Lumentum Competitors	5.57%	-5.33%	3.13%

Analyst Ratings

This is a summary of recent ratings and price targets for Lumentum and its rivals, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Lumentum	1	7	14	2	2.71
Lumentum Competitors	1076	4035	7103	383	2.54

Lumentum currently has a consensus target price of $1,053.17, indicating a potential upside of 79.85%. As a group, “Communications Equipment” companies have a potential upside of 39.47%. Given Lumentum’s stronger consensus rating and higher possible upside, equities research analysts clearly believe Lumentum is more favorable than its rivals.

Volatility & Risk

Lumentum has a beta of 1.64, meaning that its stock price is 64% more volatile than the S&P 500. Comparatively, Lumentum’s rivals have a beta of 1.17, meaning that their average stock price is 17% more volatile than the S&P 500.

Earnings & Valuation

This table compares Lumentum and its rivals gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Lumentum	$3.01 billion	-$6.94 billion	-7.44
Lumentum Competitors	$2.73 billion	$292.54 million	4.69

Lumentum has higher revenue, but lower earnings than its rivals. Lumentum is trading at a lower price-to-earnings ratio than its rivals, indicating that it is currently more affordable than other companies in its industry.

Summary

Lumentum beats its rivals on 9 of the 13 factors compared.

About Lumentum

Lumentum Holdings Inc. develops and manufactures optical and photonic products used in communications networks and industrial applications. Its offerings include optical components, modules and lasers that help transmit and process data across telecommunications and data center networks. The company also supplies lasers and related technologies for industrial uses, including precision manufacturing and semiconductor production. Its products serve customers in markets around the world. Lumentum became an independent public company in 2015 through a spin-off from JDSU, now Viavi Solutions.