Lumentum (LITE) shares rose 4.5% on Monday. Investment firm StoneX initiated coverage with a "Buy" rating. StoneX set a $1,200 price target. The firm's positive outlook stems from increasing demand for optical networking components. This demand is driven by artificial intelligence data centers.
StoneX analyst Cody Acree highlighted an accelerating timeline for near-packaged and co-packaged optics adoption. These optics are crucial for next-generation AI infrastructure. Acree noted demand for this technology moved forward to late 2027 and early 2028. This trend positions Lumentum to benefit.
StoneX also initiated coverage on Lumentum's competitor, Coherent. The firm issued a "Buy" rating for Coherent. This indicates a broader positive view of the optical components sector. The new rating adds to a largely bullish Wall Street consensus for Lumentum.