{"source_url": "https://news.yahoo.com", "url": "https://news.yahoo.com/looking-growth-stock-3-reasons-174505982.html", "title": "Looking for a Growth Stock? 3 Reasons Why Lumentum (LITE) is a Solid Choice", "top_image": "https://s.yimg.com/uu/api/res/1.2/O2lwx228jOb6RtgLzFOJnQ--~B/aD02MDA7dz05MDA7c209MTthcHBpZD15dGFjaHlvbg--/https://media.zenfs.com/en-us/zacks.com/71afbbc0512eb3c471136d93f39079c9", "meta_img": "https://s.yimg.com/uu/api/res/1.2/O2lwx228jOb6RtgLzFOJnQ--~B/aD02MDA7dz05MDA7c209MTthcHBpZD15dGFjaHlvbg--/https://media.zenfs.com/en-us/zacks.com/71afbbc0512eb3c471136d93f39079c9", "images": ["https://s.yimg.com/ny/api/res/1.2/NcZ6Hm.EZCsZDa_GHe2Wog--~A/YXBwaWQ9aGlnaGxhbmRlcjtzbT0xO3c9ODQ7aD04NA--/http://media.zenfs.com/284/2011/06/08/zacks1-106x27_152730.gif", "https://s.yimg.com/ny/api/res/1.2/wC_aF8oQZnHn.CcalN4AQw--~A/YXBwaWQ9aGlnaGxhbmRlcjtzbT0xO3c9ODAw/https://media.zenfs.com/en-us/zacks.com/71afbbc0512eb3c471136d93f39079c9", "https://s.yimg.com/uu/api/res/1.2/O2lwx228jOb6RtgLzFOJnQ--~B/aD02MDA7dz05MDA7c209MTthcHBpZD15dGFjaHlvbg--/https://media.zenfs.com/en-us/zacks.com/71afbbc0512eb3c471136d93f39079c9"], "movies": [], "text": "Investors seek growth stocks to capitalize on above-average growth in financials that help these securities grab the market's attention and produce exceptional returns. But finding a great growth stock is not easy at all.\n\nBy their very nature, these stocks carry above-average risk and volatility. Moreover, if a company's growth story is over or nearing its end, betting on it could lead to significant loss.\n\nHowever, the task of finding cutting-edge growth stocks is made easy with the help of the Zacks Growth Style Score (part of the Zacks Style Scores system), which looks beyond the traditional growth attributes to analyze a company's real growth prospects.\n\nLumentum (LITE) is on the list of such stocks currently recommended by our proprietary system. In addition to a favorable Growth Score, it carries a top Zacks Rank.\n\nStudies have shown that stocks with the best growth features consistently outperform the market. And for stocks that have a combination of a Growth Score of A or B and a Zacks Rank #1 (Strong Buy) or 2 (Buy), returns are even better.\n\nHere are three of the most important factors that make the stock of this optical networking products maker a great growth pick right now.\n\nEarnings Growth\n\nEarnings growth is arguably the most important factor, as stocks exhibiting exceptionally surging profit levels tend to attract the attention of most investors. For growth investors, double-digit earnings growth is highly preferable, as it is often perceived as an indication of strong prospects (and stock price gains) for the company under consideration.\n\nWhile the historical EPS growth rate for Lumentum is 82.7%, investors should actually focus on the projected growth. The company's EPS is expected to grow 15% this year, crushing the industry average, which calls for EPS growth of -15.2%.\n\nCash Flow Growth\n\nWhile cash is the lifeblood of any business, higher-than-average cash flow growth is more important and beneficial for growth-oriented companies than for mature companies. That's because, growth in cash flow enables these companies to expand their businesses without depending on expensive outside funds.\n\nRight now, year-over-year cash flow growth for Lumentum is 53.3%, which is higher than many of its peers. In fact, the rate compares to the industry average of -2.4%.\n\nWhile investors should actually consider the current cash flow growth, it's worth taking a look at the historical rate too for putting the current reading into proper perspective. The company's annualized cash flow growth rate has been 53.1% over the past 3-5 years versus the industry average of 20.9%.\n\nPromising Earnings Estimate Revisions\n\nBeyond the metrics outlined above, investors should consider the trend in earnings estimate revisions. A positive trend is a plus here. Empirical research shows that there is a strong correlation between trends in earnings estimate revisions and near-term stock price movements.\n\nThe current-year earnings estimates for Lumentum have been revising upward. The Zacks Consensus Estimate for the current year has surged 1% over the past month.\n\nBottom Line\n\nWhile the overall earnings estimate revisions have made Lumentum a Zacks Rank #2 stock, it has earned itself a Growth Score of A based on a number of factors, including the ones discussed above.\n\nYou can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.\n\nThis combination indicates that Lumentum is a potential outperformer and a solid choice for growth investors.\n\n\n\nWant the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report\n\n\n\nLumentum Holdings Inc. (LITE) : Free Stock Analysis Report\n\n\n\nTo read this article on Zacks.com click here.\n\n\n\nZacks Investment Research", "keywords": [], "meta_keywords": [""], "tags": [], "authors": ["Zacks Equity Research"], "publish_date": "Wed Jan  1 17:45:05 2020", "summary": "", "article_html": "", "meta_description": "Lumentum (LITE) could produce exceptional returns because of its solid growth attributes.", "meta_lang": "en", "meta_favicon": "https://s.yimg.com/os/mit/media/p/common/images/favicon_new-7483e38.svg", "meta_data": {"oath": {"guce": {"consent-host": "guce.yahoo.com"}}, "msapplication-TileColor": "#6e329d", "msapplication-TileImage": "https://s.yimg.com/rz/p/yahoo_frontpage_en-US_s_f_w_bestfit_frontpage.png", "msvalidate.01": "A9862C0E6E1BE95BCE0BF3D0298FD58B", "referrer": "unsafe-url", "theme-color": "#400090", "twitter": {"dnt": "on", "site": "@YahooNews", "card": "summary_large_image", "description": "Lumentum (LITE) could produce exceptional returns because of its solid growth attributes.", "image": {"identifier": "https://s.yimg.com/uu/api/res/1.2/O2lwx228jOb6RtgLzFOJnQ--~B/aD02MDA7dz05MDA7c209MTthcHBpZD15dGFjaHlvbg--/https://media.zenfs.com/en-us/zacks.com/71afbbc0512eb3c471136d93f39079c9", "src": "https://s.yimg.com/uu/api/res/1.2/O2lwx228jOb6RtgLzFOJnQ--~B/aD02MDA7dz05MDA7c209MTthcHBpZD15dGFjaHlvbg--/https://media.zenfs.com/en-us/zacks.com/71afbbc0512eb3c471136d93f39079c9"}, "title": "Looking for a Growth Stock? 3 Reasons Why Lumentum (LITE) is a Solid Choice"}, "application-name": "Yahoo News - Latest News & Headlines", "news_keywords": "growth stocks", "apple-itunes-app": "app-id=304158842,app-argument=yahoo://article/view?uuid=1b06d5d7-add6-3557-abbd-1d1bf2ffbc8b&src=web", "description": "Lumentum (LITE) could produce exceptional returns because of its solid growth attributes.", "og": {"type": "article", "image": "https://s.yimg.com/uu/api/res/1.2/O2lwx228jOb6RtgLzFOJnQ--~B/aD02MDA7dz05MDA7c209MTthcHBpZD15dGFjaHlvbg--/https://media.zenfs.com/en-us/zacks.com/71afbbc0512eb3c471136d93f39079c9", "description": "Lumentum (LITE) could produce exceptional returns because of its solid growth attributes.", "title": "Looking for a Growth Stock? 3 Reasons Why Lumentum (LITE) is a Solid Choice", "url": "https://news.yahoo.com/looking-growth-stock-3-reasons-174505982.html"}, "fb": {"pages": 338028696036, "app_id": 458584288257241}, "al": {"android": {"app_name": "Yahoo", "package": "com.yahoo.mobile.client.android.yahoo", "url": "yahoo://article/view?uuid=1b06d5d7-add6-3557-abbd-1d1bf2ffbc8b&src=web"}, "ios": {"app_name": "Yahoo", "app_store_id": 304158842, "url": "yahoo://article/view?uuid=1b06d5d7-add6-3557-abbd-1d1bf2ffbc8b&src=web"}}}, "canonical_link": "https://finance.yahoo.com/news/looking-growth-stock-3-reasons-174505982.html"}