Craig-Hallum downgrades Lumentum to Hold, lowers price target to $50

As previously reported, Craig-Hallum downgraded Lumentum to Hold from Buy with a price target of $50, down from $75. The firm sees Lumentum’s lowered March 31 sales guidance as "quite disappointing" given the recent OFC update that didn’t convey any potential for this magnitude of disruption. Along with datacom inventory burn and known share loss in 3DS, growth at Lumentum "has vanished quickly," and visibility into its return is murky at best, Craig-Hallum adds. While the firm remained at a Buy rating after last earnings, it believes it is now clear Lumentum will need to improve execution and messaging, and expects the stock gap down on Thursday and remain range-bound until then.