Lumen Technologies (LUMN) AI Stock Analysis

• Market Cap: $3.94B
• Dividend Yield: N/A
• Average Volume (3M): 10.42M
• Price to Earnings (P/E): ―
• Beta (1Y): 0.65
• Revenue Growth: -7.86%
• EPS Growth: 97.11%
• Country: US
• Employees: 24,000
• Sector: Communication Services
• Sector Strength: 86
• Industry: Telecommunications Services
• EPS (TTM): -0.13
• Shares Outstanding: 1,025,907,700
• 10 Day Avg. Volume: 9,595,635
• 30 Day Avg. Volume: 10,424,990
• PEG Ratio: 0.03
• Price to Book (P/B): 15.06
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 4.43
• Enterprise Value/Market Cap: 5.21
• Enterprise Value/Revenue: 0.39
• Enterprise Value/Gross Profit: 3.72
• Enterprise Value/Ebitda: 1.72
• 1Y Price Target: $5.15
• Price Target Upside: 34.11% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 5

• Rating: 51 Neutral
• Price Target: $4.00 ▲( 4.17% Upside)

Lumen Technologies presents a mixed outlook. The primary concerns are its declining revenue and high leverage, weighing heavily on the financial performance score. However, positive recent earnings call insights and strategic corporate events provide some optimism. Technical indicators suggest a neutral trend, and valuation metrics are concerning due to negative earnings and lack of dividends.

Positive Factors

Asset Sale

The company is in the process of selling its FTTH assets and customers, which could improve leverage and drive equity value.

Service Innovations

New service innovations that bypass costly cross-connects could be unmatched and game-changing for customers.

Negative Factors

Financial Uncertainty

Management stopped short of raising EBITDA guidance with caution around macro uncertainty, but noted no Enterprise weakness yet.

Valuation Concerns

The stock reacted negatively to the news because the valuation seemed low compared to previous reports.

Lumen Technologies Business Overview & Revenue Model

Company Description

Lumen Technologies, Inc. (LUMN) is a multinational technology company that provides integrated communication services to businesses and consumers. The company operates in sectors such as telecommunications, cloud computing, and cybersecurity. Lumen offers a wide range of products and services, including voice and data communication, broadband services, IT solutions, and cloud infrastructure, catering primarily to enterprise, government, and wholesale customers.

How the Company Makes Money

Lumen Technologies generates revenue through multiple streams, primarily from its business and mass markets segments. The business segment includes services such as network connectivity, hybrid IT solutions, cloud and managed services, and voice and collaboration tools, which are provided to enterprise customers, government agencies, and wholesale clients. The mass markets segment focuses on delivering broadband, voice, and other services to residential customers. Lumen benefits from strategic partnerships and collaborations with technology companies to enhance its service offerings. Additionally, the company capitalizes on its extensive fiber network and digital infrastructure to support data-intensive applications, which is a significant factor contributing to its earnings.

Lumen Technologies Financial Statement Overview

Summary

Lumen Technologies faces significant financial challenges, with declining revenues and a negative net profit margin. The company's high debt-to-equity ratio poses solvency risks, although positive cash flow ratios suggest some operational efficiency. Improvements in EBIT and EBITDA margins indicate potential recovery, but substantial leverage and depleted equity remain concerns.

Income Statement

Lumen Technologies has experienced declining revenue over the years, with TTM revenue of $13.0 billion compared to $20.7 billion in 2020. The gross profit margin for TTM is approximately 55.43%, which is strong, but the net profit margin is negative due to a net loss. EBIT and EBITDA margins have improved in the TTM compared to 2023's negative figures, indicating some recovery in operating efficiency.

Balance Sheet

The company's balance sheet shows high leverage, with a debt-to-equity ratio of approximately 62.05 in TTM. Stockholders' equity has significantly decreased over time, impacting the equity ratio, which stands at about 0.86% for TTM, indicating a highly leveraged financial structure with potential solvency risks.

Cash Flow

Lumen's cash flow analysis reveals a positive operating cash flow to net income ratio, suggesting effective cash generation despite net losses. The free cash flow growth is negative compared to prior years, but the free cash flow to net income ratio is positive, indicating some level of cash flow stability despite financial challenges.

Breakdown
TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
13.00B	13.11B	14.56B	17.48B	19.69B	20.71B
	Gross Profit
5.52B	6.41B	7.41B	9.61B	11.20B	11.78B
	EBIT
517.00M	460.00M	-9.58B	3.54B	4.29B	3.53B
	EBITDA
3.77B	4.10B	-6.09B	3.58B	8.52B	5.90B
	Net Income Common Stockholders
-313.00M	-55.00M	-10.30B	-1.55B	2.03B	-1.23B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
1.90B	1.89B	2.23B	1.25B	354.00M	406.00M
	Total Assets
33.54B	33.50B	34.02B	45.58B	57.99B	59.39B
	Total Debt
17.93B	18.16B	20.26B	20.92B	29.37B	32.22B
	Net Debt
16.03B	16.27B	18.02B	19.66B	29.01B	31.81B
	Total Liabilities
33.25B	33.03B	33.60B	35.14B	46.15B	48.23B
	Stockholders Equity
289.00M	464.00M	417.00M	10.44B	11.84B	11.16B
Cash Flow		Free Cash Flow
1.02B	1.10B	-940.00M	1.72B	3.60B	2.79B
	Operating Cash Flow
4.33B	4.33B	2.16B	4.74B	6.50B	6.52B
	Investing Cash Flow
-2.90B	-2.83B	-1.20B	5.48B	-2.71B	-3.56B
	Financing Cash Flow
-1.10B	-1.85B	-18.00M	-9.31B	-3.81B	-4.25B

Lumen Technologies Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 3.84
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For LUMN, the sentiment is Negative. The current price of 3.84 is below the 20-day moving average (MA) of 4.00, below the 50-day MA of 3.94, and below the 200-day MA of 5.55, indicating a bearish trend. The MACD of 0.02 indicates Positive momentum. The RSI at 42.02 is Neutral, neither overbought nor oversold. The STOCH value of 7.39 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for LUMN.

Lumen Technologies Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
TKC	80 Outperform	$5.58B	13.37	6.74%	2.37%	14.09%	-11.43%
PHI	73 Outperform	$4.71B	8.87	28.10%	5.57%	-0.91%	11.25%
TIGO	71 Outperform	$6.34B	17.75	10.19%	4.77%	-1.52%	4874.58%
TEO	61 Neutral	$4.66B	22.53	3.99%	―	-12.77%	40.80%
Sector *	60 Neutral	$14.12B	6.43	-3.57%	3.69%	2.49%	-35.43%
LUMN	51 Neutral	$3.94B	―	-78.94%	―	-7.86%	97.11%
TDS	49 Neutral	$3.63B	―	-0.97%	0.47%	-5.14%	78.63%

Lumen Technologies Corporate Events

Lumen Technologies Sells Fiber Business to AT&T

On May 21, 2025, Lumen Technologies announced a definitive agreement to sell its Mass Markets fiber-to-the-home business to AT&T for $5.75 billion in cash. This transaction is expected to close in the first half of 2026, subject to regulatory approvals and other conditions. The sale will allow Lumen to focus on its enterprise market and reduce its debt, enhancing its financial flexibility and enabling further investment in its enterprise offerings. Lumen will retain its core infrastructure, including its fiber backbone and consumer copper broadband services, to continue innovating for enterprise customers. The deal is anticipated to improve Lumen’s cash flow and position it for additional refinancing opportunities, while AT&T will gain a significant consumer-focused asset with potential for growth.

The most recent analyst rating on (LUMN) stock is a Sell with a $2.00 price target. To see the full list of analyst forecasts on Lumen Technologies stock, see the LUMN Stock Forecast page.

Lumen Technologies Approves Reverse Stock Split at Meeting

At Lumen Technologies‘ Annual Meeting on May 13, 2025, shareholders voted on several key items. The board of directors was elected, KPMG LLP was ratified as the independent auditor for 2025, and a reverse stock split was approved. Additionally, amendments to the Articles of Incorporation were made, including lowering the threshold for calling special meetings and removing references to an unstaggered board. The approval of a reverse stock split allows the company to implement it before May 13, 2026, potentially impacting its stock structure and shareholder value.

The most recent analyst rating on (LUMN) stock is a Sell with a $2.00 price target. To see the full list of analyst forecasts on Lumen Technologies stock, see the LUMN Stock Forecast page.

Lumen Technologies Partners with Google for Fiber Access

Lumen Technologies reported its first quarter 2025 results, highlighting progress in key areas such as operational excellence, AI backbone development, and telecom cloudification. Despite a net loss of $201 million, the company showed growth in North American business revenue and signed a significant partnership with Google for direct fiber access to Google Cloud. The adoption of Network-as-a-Service (NaaS) ports increased, supporting a shift towards a consumption-based model.