Lumentum shares rise on analyst upgrades, AI demand outlook

Lumentum Holdings Inc. shares climbed 6.0% in morning trading on Friday, as the optical communications sector rallied and the company continued to gain from recent analyst upgrades tied to artificial intelligence infrastructure demand.

Deutsche Bank initiated coverage of Lumentum with a Buy rating and set a price target of $1,200. The firm stated that Lumentum's III-V laser technology is a non-substitutable component across next-generation optical network architectures.

Evercore ISI began coverage at Outperform with a $1,100 price target, linking the investment case to AI accelerator infrastructure hitting connectivity limits. Rothschild & Co Redburn also raised its price target on the stock.

The consensus among 22 analysts now stands at Strong Buy with an average price target of $1,149.38.

At ECOC 2026, Lumentum's chief executive officer raised long-term guidance, targeting approximately $40 in earnings power by fiscal 2028 as demand shifts toward higher-margin optical products.

The stock's advance earlier this week followed the wave of analyst coverage launches and upgrades.

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