This Artificial Intelligence (AI) Stock Has Jumped 328% in 1 Year. It Can Soar Higher After Feb. 3.

Core Insights - Lumentum has outperformed Palantir over the past year, with a stock increase of 328% compared to Palantir's 166% gain, driven by demand for AI solutions [1][4]. Company Performance - Palantir's Artificial Intelligence Platform (AIP) has successfully attracted new customers and secured larger contracts, with fourth-quarter results expected on February 2 [2]. - Lumentum has consistently beaten Wall Street's earnings expectations for the last four quarters, with a revenue increase of 58% to $337 million in its fiscal Q1 2026, resulting in adjusted earnings of $1.10 per share [5][6]. - For fiscal Q2, Lumentum forecasts revenue of $650 million, a year-over-year increase of 62%, with adjusted earnings expected to triple to $1.40 per share [7]. Market Position and Valuation - Lumentum generates over 60% of its revenue from the cloud and AI infrastructure market, benefiting from robust demand from hyperscalers and networking equipment manufacturers [8]. - Analysts predict significant growth in Lumentum's earnings, with infrastructure investments by major hyperscalers projected to reach $3 trillion in the next five years [9]. - Despite a high price-to-earnings ratio of 208, Lumentum's forward earnings multiple is lower at 58, indicating strong growth potential compared to Palantir [12]. - Lumentum's sales multiple of 13 is significantly lower than Palantir's, highlighting a more attractive valuation despite both companies operating in the AI market [13]. Future Outlook - Lumentum's growth trajectory suggests potential for further stock price increases, with analysts predicting a jump to $455 if it achieves an EPS of $10.12, representing a 28% increase from current levels [14][15].