Yahoo Finance How Lumentum Holdings Inc. Shares Jumped 17% Higher Today
What happened
Sparked by a strong earnings report, shares of Lumentum Holdings (NASDAQ: LITE) jumped as much as 17.3% higher in Wednesday's morning session before settling down to an 11.7% gain at 12:45 p.m. EDT.
Image source: Getty Images.
So what
In the third quarter of fiscal year 2018, the maker of optical networking components and systems saw sales rising 17% year over year to land at $299 million. On the bottom line, adjusted earnings rose 59% to $0.78 per diluted share. Analysts would have settled for earnings of $0.71 per share on sales near $293 million. Based on these results, Lumentum offered fourth-quarter guidance roughly in line with Wall Street's current consensus estimates of earnings near $0.67 per share on sales in the neighborhood of $289 million.
Now what
Lumentum fielded strong order volumes from telecom customers in the third quarter along with 32% sales growth in the laser components segment. Reading between the lines, it looks like companies up and down the networking food chain are finally getting ready to roll out 5G wireless networks and the faster backbone networks these wireless upgrades will require.
The company is also making "good progress" on deal-making for its 3D sensor products, which could eventually become a growth-boosting division in its own right. It's easy to see why investors are getting excited about Lumentum's third-quarter report.
More From The Motley Fool
Anders Bylund has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
