LUMN Should I Buy
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Lumen Technologies Inc (LUMN) is not a strong buy for a beginner, long-term investor at this time. The company's financial performance is weak, with declining revenue, net income, and EPS in the latest quarter. While there are some positive catalysts, such as the CEO's stock purchase and improved balance sheet, the lack of clear growth signals and mixed analyst ratings suggest a cautious approach. The technical indicators and options data also do not strongly support a buy decision.
The MACD is below 0 and negatively contracting, indicating bearish momentum. RSI is neutral at 51.494, showing no clear trend. Moving averages are converging, and the stock is trading near its pivot level of 7.831, with resistance at 9.153 and support at 6.509. Overall, the technical indicators suggest a lack of strong directional movement.
The CEO's recent $500,000 stock purchase led to a 30% surge in the company's shares, indicating confidence in the company's future. The company has also improved its balance sheet and financial flexibility by reducing leverage below 4x.
Hedge funds are aggressively selling, with a 6500.25% increase in selling activity last quarter. The company's financial performance in Q4 2025 showed significant declines in revenue (-8.65% YoY), net income (-102.35% YoY), and EPS (-100.00% YoY). Analysts have mixed ratings, with some downgrades and cautious outlooks on revenue growth, which is expected to take two years to materialize.
In Q4 2025, Lumen reported a revenue drop to $3.041 billion (-8.65% YoY), a net income loss of $2 million (-102.35% YoY), and EPS of 0 (-100.00% YoY). Gross margin also dropped to 24.33% (-6.35% YoY), indicating weaker profitability.
Analysts have mixed ratings. UBS, Citi, and Goldman Sachs maintain Neutral ratings with price targets ranging from $6 to $10. Raymond James downgraded the stock to Market Perform, citing a lack of near-term top-line growth. BofA raised its price target but remains cautious on revenue growth plans. Overall, analysts are not strongly bullish on the stock.
