Lumentum vs. Amtech: Which Semiconductor Stock is the Better Buy?

Lumentum LITE and Amtech Systems ASYS operate within the semiconductor value chain, supplying critical technologies that enable advanced electronics manufacturing. Lumentum delivers optical and photonic components embedded in AI-driven data centers and high-speed networking systems. Amtech provides wafer-processing and thermal equipment used directly in semiconductor fabrication and advanced packaging.

Both companies are riding the same wave of surging AI infrastructure spending that is reshaping capital allocation across the semiconductor industry. But beneath that shared tailwind, the two stocks tell very different stories in terms of scale, growth and market positioning. Let's delve deep to determine which one is a better investment now.

The Case for LITE

Lumentum designs and manufactures optical and photonic components that form the backbone of AI data center infrastructure. Its products, spanning EML laser chips, optical transceivers, optical circuit switches and co-packaged optics, enable high-speed data movement across servers, racks and data centers. As hyperscalers expand AI compute capacity at an unprecedented pace, demand for Lumentum's components has moved from cyclical to structural, with the company now embedded in the supply chains of virtually all major cloud and AI network operators.

LITE's transceiver business has reached an important inflection point. Its 800G products are ramping strongly while the transition to 1.6T speeds is accelerating faster than anticipated. With 200-gigabit-per-lane EMLs gaining share rapidly and 1.6T margins expected to run meaningfully higher than 800G, this product mix shift is poised to drive both revenue growth and margin expansion simultaneously. The optical circuit switch business is scaling ahead of schedule with a backlog surpassing $400 million spread across multiple hyperscaler customers.

Co-packaged optics is gaining momentum with a multi-hundred-million-dollar order already secured for the first half of calendar 2027. A fourth growth driver, optical scale out, is beginning to take shape and is expected to open an entirely new addressable market by late calendar 2027. Second-quarter fiscal 2026 revenues of $665.5 million, growing 65.5% year over year, alongside third-quarter fiscal 2026 guidance of $780 million to $830 million, reflect a business where momentum is expected to accelerate further.

The Zacks Consensus Estimates for LITE’s fiscal 2026 EPS is pegged at $7.63 per share, up by 32.9% over the past 30 days. The figure indicates an increase of 270.39% year over year.

Lumentum Holdings Inc. Price and Consensus

Lumentum Holdings Inc. price-consensus-chart | Lumentum Holdings Inc. Quote

The Case for ASYS

Amtech Systems supplies thermal processing equipment and consumables used in semiconductor device packaging and substrate fabrication. Its reflow systems are deployed by leading OSATs and OEMs for packaging AI GPUs, while its consumables support chemical mechanical planarization processes across silicon carbide and advanced substrate applications. The company has been reshaping its portfolio around AI semiconductor demand, with AI-related equipment accounting for 35% of the Thermal Processing Solutions segment revenues in the first quarter of fiscal 2026, reflecting growing traction in advanced packaging applications.

Despite this directional progress, the AI-related business remains too small a portion of overall revenue to compensate for structural weakness elsewhere. Mature node semiconductor demand continues to weigh on results, silicon carbide customers remain under severe cost pressure and non-AI segments have shown little sign of recovery. This dynamic has kept consolidated revenues range-bound, with fiscal first-quarter revenues declining 22% year over year to $18.97 million, reflecting how concentrated the company's challenges remain outside of its AI packaging niche. 

Amtech's longer-term opportunity in next-generation high-density packaging and panel-level packaging is acknowledged, but meaningful demand from these initiatives is not expected until 2027. With fiscal second-quarter revenues anticipated between $19 million and $21 million, near-term growth remains heavily contingent on a broader semiconductor market recovery that has yet to materialize, leaving the growth dependent on uncertain future prospects rather than current opportunities.

The Zacks Consensus Estimates for ASYS’s fiscal 2026 EPS is pegged at 25 cents per share, down by 41.9% over the past 30 days, while indicating an annual growth of 400% due to a very low base.

Amtech Systems, Inc. Price and Consensus

Amtech Systems, Inc. price-consensus-chart | Amtech Systems, Inc. Quote

Price Performance and Valuation of LITE and ASYS

Over the trailing three months, LITE shares have surged 123.1% while ASYS shares have returned 61.4%. Lumentum's outperformance reflects its accelerating revenue momentum and deepening hyperscaler relationships. Amtech's appreciation, though notable, has been driven largely by broader AI sentiment rather than any meaningful improvement in its underlying business, with consolidated revenue continuing to decline and near-term earnings estimates revised sharply downward.

LITE vs. ASYS Price Performance

LITE trades at 11.71x price-to-sales compared to ASYS at 1.99x. Lumentum's premium is justified by its structural hyperscaler relationships, a $400 million-plus OCS backlog and secured co-packaged optics orders extending into calendar 2027. Amtech's discount reflects a declining revenue base, AI demand that remains a small fraction of consolidated sales and meaningful growth deferred to 2027.

LITE vs. ASYS Valuation

Conclusion

Lumentum's structural hyperscaler relationships, multi-product growth roadmap and accelerating revenue momentum make it a better choice over Amtech. LITE presents a compelling investment opportunity, with the bulk of its growth catalysts still ahead. Amtech's declining revenue, persistent non-AI weakness and growth initiatives deferred to 2027 make it prudent to stay away from ASYS for now.

LITE currently sports a Zacks Rank #1 (Strong Buy), while ASYS carries a Zacks Rank #5 (Strong Sell). You can see the complete list of today's Zacks #1 Rank stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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