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 moment. Despite some positive developments in its transformation strategy and innovation recognition, the company's weak financial performance, lack of strong trading signals, and mixed analyst sentiment suggest that it would be prudent to wait for clearer signs of growth or stability before investing.
The technical indicators are mixed. The MACD is positive but contracting, RSI is neutral at 49.536, and moving averages are bullish (SMA_5 > SMA_20 > SMA_200). The stock is trading near its pivot level of 6.738, with resistance at 6.994 and support at 6.482. However, the pre-market price is slightly down (-0.30%), indicating no strong momentum.
Lumen has been recognized as one of the World's Most Innovative Companies, signaling progress in its transformation. The company is expanding its intercity fiber network and has exceeded 2,000 customers for its Network-as-a-Service platform. Upcoming investor day on February 25 could provide further clarity on its five-year plan.
Hedge funds are aggressively selling, with a 6500.25% increase in selling activity last quarter. Insiders remain neutral, and there is no significant buying activity. Analysts are mixed, with some downgrades and cautious outlooks. Financial performance remains weak, with revenue, net income, and EPS all declining significantly YoY.
In Q4 2025, revenue dropped by -8.65% YoY to $3.041 billion. Net income fell to -$2 million, down -102.35% YoY. EPS dropped to 0, down -100% YoY. Gross margin also declined to 24.33%, down -6.35% YoY. The company is struggling with profitability and growth.
Analysts are mixed. UBS raised its price target to $6 but remains Neutral. Goldman Sachs increased its target to $7.25, citing potential catalysts but keeps a Neutral rating. Citi lowered its target to $10 from $11, citing mixed Q4 results. Raymond James downgraded the stock to Market Perform, citing a lack of near-term growth prospects.
