Lumen Technologies (NYSE: LUMN) stock is rising sharply in today’s market session. At 2:30 p.m. ET, the telecommunications company’s share price was up 2.5% after reaching a peak gain of 15.4% earlier in the day.
Lumen’s stock price increased significantly following the announcement of a new partnership with Meta Platforms (NASDAQ: META). This agreement involves Lumen providing network infrastructure and services, specifically fiber internet, to bolster Meta’s network capacity and support its artificial intelligence (AI) projects. Lumen will offer access to its existing fiber routes as well as establish new routes connecting data centers.
Strategic Partnership with Meta Platforms
The collaboration with Meta comes shortly after Lumen secured contracts to support Microsoft‘s AI initiatives earlier this year. The subsequent stock pullback after initial gains may reflect investor uncertainty regarding whether this Meta deal represents new business or merely reinforces prior expectations.
Future Outlook for Lumen’s Stock
This year, Lumen’s stock has surged approximately 259%. Much of this impressive growth stems from enthusiasm for the company’s potential to deliver networking solutions for data centers and AI applications.
While specific financial details of the Meta partnership were not disclosed, Lumen’s previous deal with Microsoft indicates a substantial revenue potential from this alliance. Following the Microsoft agreement, Lumen reported securing $5 billion in new business due to AI demand. The telecom provider also mentioned ongoing discussions that could yield additional contracts valued at up to $7 billion.
Securing such significant contracts certainly represents a positive development for Lumen’s financial health. The connection to AI enhances investor interest, although it’s important to note that many specifics regarding these agreements are still unclear. Moreover, Lumen faces a considerable debt burden that it needs to address.
An Opportunity to Invest in Growth
If you’ve ever felt you missed out on major stock investment opportunities, you might find this news intriguing.
Occasionally, our team of analysts identifies companies they believe are on the verge of strong growth, issuing a “Double Down” stock recommendation. If you think you missed your chance, now could be the ideal time to invest. Here’s the performance from past recommendations:
- Amazon: A $1,000 investment in 2010 would be worth $21,285!*
- Apple: A $1,000 investment in 2008 would have grown to $44,456!*
- Netflix: A $1,000 investment in 2004 would now be worth $411,959!*
Currently, we are offering “Double Down” alerts for three exceptional companies, and this opportunity may not come again soon.
See 3 “Double Down” stocks »
*Stock Advisor returns as of October 21, 2024
Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to Meta Platforms CEO Mark Zuckerberg, serves on The Motley Fool’s board of directors. Keith Noonan holds no position in any of the mentioned stocks. The Motley Fool has positions in and recommends Meta Platforms and Microsoft. The Motley Fool recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. Read The Motley Fool’s disclosure policy for more information.
The views and opinions expressed herein are those of the author and do not necessarily reflect those of Nasdaq, Inc.
