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Lumentum Holdings Financial Strength

: 6 (As of Mar. 2022)
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Lumentum Holdings has the Financial Strength Rank of 6.

GuruFocus Financial Strength Rank measures how strong a company's financial situation is. It is based on these factors:

1. The debt burden that the company has as measured by its Interest Coverage (current year). The higher, the better.
2. Debt to revenue ratio. The lower, the better.
3. Altman Z-Score.

Lumentum Holdings's Interest Coverage for the quarter that ended in Mar. 2022 was 2.37. Lumentum Holdings's debt to revenue ratio for the quarter that ended in Mar. 2022 was 1.21. As of today, Lumentum Holdings's Altman Z-Score is 3.00.


Competitive Comparison

For the Communication Equipment subindustry, Lumentum Holdings's Financial Strength, along with its competitors' market caps and Financial Strength data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

   

Lumentum Holdings Financial Strength Distribution

For the Hardware industry and Technology sector, Lumentum Holdings's Financial Strength distribution charts can be found below:

* The bar in red indicates where Lumentum Holdings's Financial Strength falls into.



Lumentum Holdings Financial Strength Calculation

GuruFocus Financial Strength Rank measures how strong a company's financial situation is. It is based on these factors

A company ranks high with financial strength is likely to withstand any business slowdowns and recessions.

1. The debt burden that the company has as measured by its Interest Coverage (current year). The higher, the better.

Note: If both Interest Expense and Interest Income are empty, while Net Interest Income is negative, then use Net Interest Income as Interest Expense.

Interest Coverage is a ratio that determines how easily a company can pay interest expenses on outstanding debt. It is calculated by dividing a company's Operating Income (EBIT) by its Interest Expense:

Lumentum Holdings's Interest Expense for the months ended in Mar. 2022 was $-20 Mil. Its Operating Income for the months ended in Mar. 2022 was $47 Mil. And its Long-Term Debt & Capital Lease Obligation for the quarter that ended in Mar. 2022 was $1,500 Mil.

Lumentum Holdings's Interest Coverage for the quarter that ended in Mar. 2022 is

Interest Coverage=-1*Operating Income (Q: Mar. 2022 )/Interest Expense (Q: Mar. 2022 )
=-1*46.7/-19.7
=2.37

The higher the ratio, the stronger the company's financial strength is.

2. Debt to revenue ratio. The lower, the better.

Lumentum Holdings's Debt to Revenue Ratio for the quarter that ended in Mar. 2022 is

Debt to Revenue Ratio=Total Debt (Q: Mar. 2022 ) / Revenue
=(Short-Term Debt & Capital Lease Obligation + Long-Term Debt & Capital Lease Obligation) / Revenue
=(418.1 + 1500.4) / 1581.6
=1.21

3. Altman Z-Score.

Z-Score model is an accurate forecaster of failure up to two years prior to distress. It can be considered the assessment of the distress of industrial corporations.

The zones of discrimination were as such:

When Z-Score is less than 1.81, it is in Distress Zones.
When Z-Score is greater than 2.99, it is in Safe Zones.
When Z-Score is between 1.81 and 2.99, it is in Grey Zones.

Lumentum Holdings has a Z-score of 3.00, indicating it is in Safe Zones. This implies the Z-Score is strong.

Good Sign:

Altman Z-score of 3 is strong.

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.


Lumentum Holdings  (NAS:LITE) Financial Strength Explanation

The maximum rank is 10. Companies with rank 7 or higher will be unlikely to fall into distressed situations. Companies with rank of 3 or less are likely in financial distress.

Lumentum Holdings has the Financial Strength Rank of 6.


Lumentum Holdings Financial Strength Related Terms

Thank you for viewing the detailed overview of Lumentum Holdings's Financial Strength provided by GuruFocus.com. Please click on the following links to see related term pages.


Lumentum Holdings Business Description

Lumentum Holdings logo
Traded in Other Exchanges
Address
1001 Ridder Park Drive, San Jose, CA, USA, 95131
Lumentum Holdings Inc is a California-based technology firm. The company provides two types of optical and photonic products: optical components that are used in telecommunications networking equipment, and commercial lasers for manufacturing, inspection, and life-science lab uses. Its segments are OpComms and Lasers. The firm is also expanding into new optical applications, such as 3-D sensing laser diode for consumer electronics. It generates maximum revenue from the OpComms segment. The OpComms segment products include a wide range of components, modules and subsystems to support customers including carrier networks for access (local), metro (intracity), long-haul (city-to-city and worldwide), and submarine (undersea) applications.
Executives
Harris Isaac Hosojiro director 310 W 113TH ST # 801 NEW YORK NY 10026-3389
Wong Janet S. director 2510 LAKE FRONT CIRCLE THE WOODLANDS TX 77380-1576
Covert Harold L director 400 NORTH MCCARTHY BLVD MILPITAS CA 95035
Thomas Samuel F director 400 N MCCARTHY BLVD MILPITAS CA 95035
Johnson Julia Suzanne director 1001 RIDDER PARK STREET SAN JOSE CA 95131
Small Ian director 400 N MCCARTHY BLVD MILPITAS CA 95035
Herscher Penny director 1001 RIDDER PARK DRIVE SAN JOSE CA 95131
Lillie Brian director 1485 BROOKMILL ROAD LOS ALTOS CA 94024
Ali Wajid officer: EVP & Chief Financial Officer 400 N MCCARTHY BLVD MILPITAS CA 95035
Retort Vincent officer: EVP, Chief Operating Officer 400 MCCARTHY BLVD MILPITAS CA 95035
Reinhardt Jason officer: EVP, Global Sales 400 N. MCCARTHY BLVD MILPITAS CA 95035
Lowe Alan S director, officer: Chief Executive Officer 400 NORTH MCCARTHY BLVD MILPITAS CA 95035
Sepe Matthew Joseph officer: Chief Accounting Officer 400 NORTH MCCARTHY BLVD MILPITAS CA 95035
Hamel Judy G officer: SVP, GC and Secretary 400 MCCARTHY BLVD MILPITAS CA 95035
Coldren Christopher W. officer: Interim CFO 400 NORTH MCCARTHY BLVD MILPITAS CA 95035

Lumentum Holdings Headlines

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