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Verdict
Quantitative factor alignment verified for current market regime.
Quant Score
Rank
#2957
Positioning
Market Dominance
Transportation, Communications, Electric, Gas, And Sanitary Services
Communication
$6.3B
Kate E. Johnson
Lumen Technologies, Inc. provides various integrated products and services under the Lumen, Quantum Fiber, and CenturyLink brands. The company operates in two segments, Business and Mass Markets. As of December 31, 2021, the company served approximately 4.5 million broadband subscribers.
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| Stock | Rating | Score▼ | Quality | Value | Momentum | P/E | EV/EBITDA | ROE | ROA | Gross Mgn | Op Mgn | Net Mgn | Rev Growth | Div Yield | D/E | Mkt Cap | AUDIT |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
$UGP ULTRAPAR HOLDINGS INC | 79 | 90 | 95 | 87 | - | - | - | - | - | - | - | - | - | - | $0 | VS | |
$TNK TEEKAY TANKERS LTD. | 78 | 94 | 97 | 82 | - | - | - | - | - | - | - | - | - | - | $0 | VS | |
$DHT DHT Holdings, Inc. | 75 | 84 | 88 | 78 | - | - | - | - | - | - | - | - | - | - | $0 | VS | |
$STNG Scorpio Tankers Inc. | 75 | 86 | 95 | 74 | - | - | - | - | - | - | - | - | - | - | $0 | VS | |
$NAT NORDIC AMERICAN TANKERS Ltd | 75 | 82 | 88 | 87 | - | - | - | - | - | - | - | - | - | - | $0 | VS | |
$AMX AMERICA MOVIL SAB DE CV/ | 74 | 86 | 81 | 68 | - | - | - | - | - | - | - | - | - | - | $0 | VS | |
$PAC Pacific Airport Group | 73 | 94 | 80 | 78 | - | - | - | - | - | - | - | - | - | - | $0 | VS | |
$GSL Global Ship Lease, Inc. | 73 | 82 | 94 | 81 | - | - | - | - | - | - | - | - | - | - | $0 | VS | |
$TRMD TORM plc | 73 | 86 | 94 | 65 | - | - | - | - | - | - | - | - | - | - | $0 | VS | |
$VIV TELEFONICA BRASIL S.A. | 73 | 82 | 90 | 78 | - | - | - | - | - | - | - | - | - | - | $0 | VS | |
$LUMN Lumen Technologies, Inc. | 44 | 32 | 41 | 78 | - | 3.3x | 210.3% | -5.5% | 46.7% | -4.0% | -15.2% | -5.5% | 0.0% | - | $6.3B | ||
| SECTOR BENCH | - | - | - | - | - | 16.9x | 6.1x | 11.9% | 3.2% | 52.6% | 14.8% | 7.7% | 4.2% | 1.4% | 1.3x | - | REF |
Lumen Technologies, Inc. (LUMN) receives a "Reduce" rating with a composite score of 44.1/100. It ranks #2957 out of 7,333 stocks in our coverage universe and carries a 2-star rating. Ratings are driven by a 6-factor quantitative model measuring quality, value, momentum, investment, stability, and short interest.
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Outperforming peers — winners tend to keep winning over 3-12 months
Fair valuation relative to peers
Weak fundamentals — higher risk of value trap
High volatility — wider range of outcomes increases timing risk
Aggressive spending — empire-building risk, dilutive growth
Mid-range overall rating
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Relative valuation derived from Transportation, Communications, Electric, Gas, And Sanitary Services sector benchmarks. Model weights: EV/EBITDA (40%), P/B (35%), P/S (25%). Re-calculated daily.
No analyst ratings for LUMN.
View All Ratings| Factor | Global | Sector | Tilt |
|---|---|---|---|
| PROFITABILITY | 32 | 23 | +9ALPHA |
| MOMENTUM | 78 | 84 | -6DRAG |
| VALUATION | 41 | 42 | -1NEUTRAL |
| INVESTMENT | 32 | 36 | -4NEUTRAL |
| STABILITY | 13 | 7 | +6ALPHA |
| SHORT INT | 64 | 75 | -11DRAG |
Global = full universe. Sector = relative to industry peers. Positive tilt indicates idiosyncratic strength.
ROIC -4.2% vs WACC 7.0% (spread -11.2%)
GM 47% vs sector 53%, OM -4% vs sector 15%
Capital turnover 0.81x
Rev growth -6%, 10yr history
Interest coverage -0.6x, Net debt/EBITDA 7.9x
Composite assessment of profitability, capital efficiency, and financial strength. Top-tier entities demonstrate sustainable cash flow generation and elite competitive moats.
Profit generated per dollar of shareholder equity
Efficiency of asset utilization
Pricing power and cost efficiency
Core business profitability
Bottom-line profitability
The Quality factor evaluates the persistence and magnitude of realized cash flows. Companies with scores >70 exhibit superior pricing power and structural financial resilience through diverse economic regimes.
Our uncertainty rating tracks the predictability of future cash flows and potential for permanent capital loss. Moderate visibility with standard industry cyclicality.
We rate Lumen Technologies, Inc. (LUMN) as a Reduce with a composite score of 44.1/100 at a current price of $7.50. The quantitative profile shows weakness across multiple dimensions, suggesting limited upside potential.
Lumen Technologies, Inc. holds a top-quartile position (#0 of 50) within the Transportation, Communications, Electric, Gas, And Sanitary Services sector, based on our composite quantitative scoring across quality, value, momentum, and stability factors. The composite score of 44.1/100 places it at rank #2957 in our full universe.
The near-term outlook is constructive, with revenue growing at -6% and momentum in the 78th percentile confirming positive market sentiment. The combination of strong top-line growth and favorable price dynamics suggests the company is executing well on its growth strategy.
No Moat
Very High
Poor
Fair Value
Gross margins of 47% signal strong pricing power.
Returns on equity of 210.3% exceed cost of capital.
Positive momentum indicates institutional accumulation.
Below-average quality raises earnings sustainability concerns.
Vulnerability to macroeconomic shocks and interest rate volatility.
Lumen Technologies, Inc. represents a reduce based on multi-factor quantitative performance.
Lumen Technologies, Inc. receives a Reduce rating from our analysis, with a composite score of 44.1/100 and 2 out of 5 stars, ranking #2957 out of 7,333 stocks. LUMN's factor profile shows weakness across multiple dimensions, suggesting the stock may underperform going forward. Existing holders may want to consider trimming positions or tightening stop-losses.
LUMN's quality score of 32/100 is below average, suggesting challenges with profitability or capital efficiency. The company reports a return on equity of 210.3% (sector avg: 11.9%), gross margins of 46.7% (sector avg: 52.6%), net margins of -15.2% (sector avg: 7.7%). Investors should examine whether management is actively addressing these weaknesses or if they reflect structural industry headwinds.
With a value score of 41/100, LUMN appears somewhat expensive relative to its fundamentals. Key valuation metrics include an EV/EBITDA of 3.33x. Investors paying a premium here are likely betting on above-average growth or margin expansion to justify current prices.
Lumen Technologies, Inc.'s investment score of 32/100 suggests limited reinvestment activity. Key growth metrics include revenue growth of -5.5% vs. a sector average of 4.2% and a return on assets of -5.5% (sector: 3.2%). While this can be positive for mature, cash-generative businesses returning capital to shareholders, it may also signal a lack of growth opportunities or management conservatism.
LUMN shows strong momentum characteristics with a score of 78/100. The stock has been trending above key moving averages, indicating solid demand from institutional buyers. Revenue growth stands at -5.5% year-over-year, while a beta of 2.09 reflects its sensitivity to broader market moves. This level of momentum typically signals sustained investor confidence and favorable near-term price action.
Lumen Technologies, Inc. registers a low stability score of 13/100, indicating high volatility and potentially stressed financial conditions. Key stability metrics include a beta of 2.09. Stocks at this level carry elevated capital loss risk and may be unsuitable for conservative portfolios without careful risk management.
LUMN carries a short interest score of 64/100, indicating moderate short selling activity. This is a neutral reading — not enough to signal systemic bearishness, but worth monitoring. Specific risk factors include high market sensitivity (beta: 2.09). At $6.3B market cap (mid-cap), Lumen Technologies, Inc. offers reasonable institutional liquidity.
Lumen Technologies, Inc. is a mid-cap company in the Transportation, Communications, Electric, Gas, And Sanitary Services sector, ranked #0 of 50 in its sector (100th percentile) and #2957 of 7,333 overall (60th percentile). Key comparisons include ROE of 210.3% exceeding the 11.9% sector median and operating margins of -4.0% below the 14.8% sector average. This top-quartile standing reflects exceptional competitive strength relative to Transportation, Communications, Electric, Gas, And Sanitary Services peers.
While LUMN currently exhibits a REDUCE profile, superior opportunities exist within the TRANSPORTATION, COMMUNICATIONS, ELECTRIC, GAS, AND SANITARY SERVICES sector. Our model identifies several "Strong Buy" candidates with higher quality scores and more attractive valuations among direct industry competitors.
View Top Transportation, Communications, Electric, Gas, And Sanitary Services Alpha →Quant Factor Profile
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Improvement in Stability (13) would have the largest impact on the composite score.
EV/EBITDA 45% BELOW SECTOR MEDIAN (FAVORABLE)
ROE 1663% ABOVE SECTOR MEDIAN (FAVORABLE)
Gross Margin 11% BELOW SECTOR MEDIAN
Above 50MA
37.18%
Net New Highs
+51081
AT&T's $5.75 billion acquisition of Lumen's fiber assets will add 4 million passed locations and 1 million subscribers. While integration costs will pressure near-term earnings by ~$0.05 per share in 2026, the deal presents significant long-term opportunities through cross-selling fiber and wireless services. Lumen's 25% penetration rate versus AT&T's 40% suggests ~600,000 potential new customers, plus opportunities to convert Lumen's wireless customers. AT&T expects double-digit EPS growth through 2028 and free cash flow expansion to at least $21 billion by 2028.
Lumen Technologies stock surged 29.4% after CEO Kate Johnson purchased $500,000 worth of shares, signaling confidence in the company's turnaround strategy following a post-earnings sell-off. While the company continues to face revenue and profit declines overall, management estimates 47% of enterprise revenue comes from growing products that expanded 7% last year. Lumen's debt has improved following the sale of its fiber-to-home business to AT&T, though the stock remains a risky play dependent on AI-oriented networking solutions gaining market traction.
Aalyria, which was spun out of Google in 2022, raised $100 million in a funding round led by Battery Ventures.
AT&T's fiber-optic broadband business is positioned to drive double-digit EPS growth through 2028, with the company expecting to reach over 40 million customer locations by end of 2026. The fiber segment, currently less than 15% of revenue, could add nearly $3 billion in annual revenue as it expands from 10.6 million to 13.6 million customers. AT&T's guidance projects adjusted EPS of $2.25-$2.35 in 2026 with double-digit three-year CAGR, while maintaining a strong dividend yield of over 4%.
CapWealth Advisors increased its Lumen Technologies stake by 704,970 shares worth approximately $9.92 million. Following the purchase, Lumen represents 3.3% of CapWealth's portfolio. The investment comes as Lumen completed the sale of its Mass Markets fiber-to-the-home business to AT&T for $5.75 billion to focus on enterprise and AI-driven digital infrastructure.