Olympus SH-2 vs. Panasonic Lumix DMC-LZ40: A Hands-On Superzoom Showdown

When it comes to small sensor superzoom cameras, we're spoiled with options that promise mega reach in pocket-friendly (well, mostly) bodies. Two cameras that sit comfortably in that crowd are the Olympus Stylus SH-2 (hereafter, SH-2) and the Panasonic Lumix DMC-LZ40 (let’s call it LZ40). While they target the casual enthusiast who craves zoom but doesn’t want the hassle (or price) of interchangeable lenses, these models approach that promise with slightly different personalities.

With over 15 years giving cameras the ol’ rigorous eyeball and a trigger-happy finger, I’ve put these two rivals head-to-head through real-world tests and technical deep-dives. Buckle up - there’s more to the comparison than megapixels and zoom range.

Compact vs. Bridge: Size, Build, and Ergonomics

One of the first decisions most buyers face is how a camera feels in the hand and whether it fits the niche they're aiming for - pocket portability or a bulkier grip with more control options.

Here’s where the SH-2 shines as a truly compact camera. Measuring a trim 109 x 63 x 42 mm and weighing only 271 grams, it’s a discreet companion for street wandering and casual travel. Its streamlined body means it slips easily into larger jacket pockets or small bags without feeling like you’re lugging a brick.

By contrast, the LZ40 is more bridge-style with pronounced grips and heft - it clocks in at 126 x 87 x 94 mm and a substantial 524 grams. While it's still far from a professional DSLR in size, it's quite a club for your thumbs, clearly designed for users wanting a more robust hold and perhaps a higher sense of “camera-in-hand.” The grip and controls aim to mimic heavier cameras, which some will find more comfortable for extended shooting, especially when hunting wildlife or using long zooms.

Top View Controls and Interface: Hands-On Usability

A camera’s layout is a secret weapon that’s often overlooked but can mean the difference between capturing the moment or missing it. The SH-2 leverages a clean, minimalistic approach with a mode dial, zoom rocker, and buttons that are well spaced and tactile for quick fumbling-free operation.

The LZ40 leans into more physical controls - it sports dedicated zoom and shutter buttons, a mode dial, and several function buttons. However, it doesn’t feature touchscreen capabilities, which adds a slight friction in menu navigation compared to the SH-2’s touch interface.

For those accustomed to modern camera designs where touchscreens speed workflow, the SH-2's touch sensitivity on its rear LCD (and live view AF selection) gives a noticeable edge during quick composition and focus adjustments. The LZ40’s traditional button-driven interface might appeal to classicists but could slow you down in fast-paced scenarios.

Sensor and Image Quality: Pixel Peeping Meets Real-World Performance

Both cameras use the standard 1/2.3-inch sensor size typical to superzooms, but the SH-2’s 16MP BSI-CMOS sensor is architecturally superior to the LZ40’s 20MP CCD sensor. Let me unpack that.

BSI (Backside Illuminated) CMOS sensors generally provide better low-light performance, dynamic range, and noise control compared to CCD sensors, which are older tech. And although the LZ40 boasts a higher pixel count (20MP vs. 16MP), its pixel density is more cramped, which often sacrifices noise handling and dynamic range.

My side-by-side ISO testing in dimmer light conditions underscored this. The SH-2 produced cleaner images at ISO 800 and above with less color blotching and better shadow rendition. The LZ40 struggled noticeably at higher ISOs, with obvious grain and color shifts, making it less suited for low-light or indoor shooting.

Both cameras feature a fixed anti-aliasing filter, which helps curb moiré but at a slight cost to ultimate sharpness. Unless you’re printing posters or doing pixel-level pixel peeping, this limitation won’t be a dealbreaker.

Screen and Viewfinder: Composing Images Your Way

Neither model includes an electronic viewfinder, which is a notable omission for some since shooting in bright daylight can be challenging on LCDs alone.

Both cameras feature a 3-inch fixed LCD screen with 460k dot resolution - standard fare for their class. The SH-2’s screen is a touchscreen, giving you the ability to tap for focus and adjust settings on the fly, enhancing speed and ergonomics.

The LZ40’s screen is non-touch TFT LCD - less flexible but still decent visibility indoors. Neither screen tilts or articulates, limiting flexibility in shooting angles.

If you frequently shoot in sunlight or awkward positions, you might find these screens limiting, but for casual snaps or tripod work, they’ll suffice.

Lens Focal Range and Aperture: Zooming into Practicality

Remember, superzoom cameras hinge on their lens versatility.

• Olympus SH-2: 25-600 mm (24× zoom) with an aperture range of F3.0-6.9
• Panasonic LZ40: 22-924 mm (42× zoom) with an aperture range of F3.0-6.5

While the LZ40’s zoom reach is jaw-droppingly long (at 924 mm equivalent), remember this comes at the cost of size, weight, and generally more optical compromises at max zoom. The SH-2’s slightly shorter zoom still reaches an impressive 600mm equivalent but benefits from optical stabilization and a lens design optimized for sharpness.

My real-world booster shots showed the LZ40 struggles with sharpness and chromatic aberration at the extreme telephoto end, delivering images softer than one would hope. The SH-2 maintained better edge-to-edge sharpness and more pleasing bokeh, making it a better performer for portrait and wildlife telephoto shots, even though it can’t match Panasonic’s zoom length.

If sheer length is your obsession (say, distant wildlife or surveillance style captures), the LZ40 may tempt you. But for image quality combined with respectable reach, the SH-2 leads the pack.

Autofocus System: Locking Focus Under Fire

AF performance in compact superzooms is notoriously mixed. Both cameras use contrast-detection autofocus, which is slower and less responsive than phase-detection or hybrid systems.

• Olympus SH-2 autofocus supports face detection, touch-to-focus, continuous AF, and tracking. Its contrast-detection is relatively quick and accurate for the class.
• Panasonic LZ40 has 9 AF points with center-weighted metering and similar face detection but lacks touch AF.

In daylight and stable conditions, both cameras lock focus well. However, the SH-2’s touch AF lets you quickly pick focus areas in live view - an underrated advantage especially when the autofocus hunting begins in tricky lighting.

In low light or fast action, both focus systems falter, but the SH-2’s AF tracking performed better for moderate moving subjects (e.g., kids playing, pets). The LZ40 was slower, often hunting, which could frustrate sports or wildlife photographers.

Shooting Speed and Burst Rates: Catching the Decisive Moment

• SH-2: Continuous shooting up to 11.5 fps
• LZ40: Continuous shooting at 1 fps

This is a stark difference that will shape your choice. The SH-2 can hold its own shooting bursts of action, essential if you’re trying to capture fleeting moments, whether in sports or casual wildlife.

The LZ40’s 1 fps burst rate is closer to single-shot, limiting it to more deliberate shots - not ideal for anything with movement.

Video Capabilities: Beyond Stills

Video is a big consideration even for stills shooters today.

• Olympus SH-2 records Full HD (1920x1080) at 60p and 30p in H.264 format. It includes sensor-shift image stabilization that helps smooth handheld footage, but no microphone input.
• Panasonic LZ40 records max HD (1280x720) at 30p in Motion JPEG, which is dated and less efficient for serious video work. It does have a microphone input - a rare feature in this category.

While the SH-2’s video quality and frame rates are superior, the lack of external mic input and limited codec options make it a modest choice for video enthusiasts. The LZ40, while limited in resolution, will appeal if capturing video with external audio sources is crucial (like interviews or vlogging), though quality suffers.

Battery Life & Storage: Staying Powered on the Go

• SH-2 boasts 380 shots per charge (CIPA standard), using a proprietary Lithium-ion battery (LI-92B).
• LZ40 manages 320 shots per charge, also Lithium-ion but different model.

Both exceed average usage for casual photography days, but if you’re hitting a long shoot or travel day without the chance to recharge, the SH-2 gives you a bit more breathing room.

Both accept SD/SDHC/SDXC cards and have single card slots. Internal storage is minimal, a common trait here, so invest in memory cards according to your shooting habits.

Connectivity and Extras: Wireless and Built-In Features

SH-2 offers built-in WiFi for easy image transfer and remote camera control - a helpful modern convenience. No Bluetooth or NFC, however.

LZ40 has none of these wireless features, relying on USB 2.0 for data transfer.

From a practical standpoint, Olympus’s inclusion of WiFi is a significant plus for social media sharers or quick uploads on-the-go.

Real-World Use in Key Photography Disciplines

Portrait Photography

The SH-2’s sharper lens, pleasing bokeh at longer focal lengths, and face detection technology make it the better pick. Its ability to render natural-looking skin tones, combined with sensor-shift image stabilization, enables handheld portraits even in dimmer interiors.

LZ40’s longer zoom doesn’t translate to more flattering portraits; the optical compromises and less effective stabilization often yield softer images and tougher focusing.

Landscape Photography

Both cameras can deliver decent landscape images in good light, but the higher resolution and CMOS sensor advantages of the SH-2 yield generally better dynamic range and color depth.

Neither camera is weather-sealed, so consider protection strategies outdoors.

Wildlife and Sports Photography

The SH-2 edges out the LZ40 with faster autofocus, higher burst rates, and better image stabilization. But the LZ40’s super-long zoom might be attractive if you don't mind manual patience for focus hunting.

Street Photography

The SH-2’s compact size and quick touchscreen controls make it a stealthier choice for street candids. The LZ40’s bulk and slower operation can be a hindrance in spontaneous shooting.

Macro Photography

The LZ40 boasts a closer macro focusing range (1 cm vs. 3 cm), beneficial for capturing tiny subjects with detail. However, the SH-2’s superior image stabilization partially compensates for slightly longer focusing distance.

Night and Astro Photography

Neither camera is an astro powerhouse due to sensor size and limitations, but the SH-2’s better ISO performance and longer shutter speed (up to 30s) make it the more competent option in dark conditions.

Video Use Cases

For casual Full HD video, SH-2 is the clear champ - smoother footage and better resolution. For mics and slightly more audio control, LZ40 offers inputs but lower quality video.

Travel Photography

The SH-2’s compactness, weight advantage, built-in WiFi, and battery life give it strong travel photo utility. LZ40 weighs more, lacks wireless, but appeals with its zoom range.

Professional Workflows

Neither camera replaces professional-grade tools, but the SH-2’s RAW support and WiFi ease fulfillment of workflows better than the LZ40’s JPEG-only files.

Final Performance Ratings

While we don’t have DxOMark scores here, my testing suggests the SH-2 outperforms the LZ40 in almost every critical parameter except zoom reach.

How Each Camera Performs Across Genres

This breakdown reflects practical usability rather than just specs: SH-2 excels in portraits, street, and landscapes; LZ40 best for extreme telephoto or macro close-ups in controlled lighting.

Sample Shots Speak Louder Than Specs

Examining these, you’ll notice the SH-2 produces cleaner shadows and more vibrant colors. The LZ40 sometimes falters with edge softness and noise at higher ISOs.

Weighing Value: What You Get for Your Money

At current prices - approximately $399 for the SH-2 vs. $219 for the LZ40 - the Olympus commands almost double the budget but rewards you with significant image quality gains, control, and convenience features.

If you prioritize zoom length and a modest outlay, the LZ40 is tempting. But if you want a camera that balances zoom, quality, performance, and packs in modern features, the SH-2 is worth the premium.

To Touch or Not to Touch? User Interface Decisions

If you crave a touchscreen and want to experiment with focus beam placement or quick setting adjustments, the SH-2 wins hands down.

The LZ40’s more traditional buttons may feel archaic but sometimes stick to basics helps avoid accidental taps.

Ergonomics and Handling: The Long Game

I spent two consecutive weekends testing both cameras during hikes and family shoots. The SH-2’s light weight left my hand less fatigued. The LZ40’s heft felt reassuring when handling longer zoom shots but slowed me down on the move.

Both cameras lack customizable buttons or hot shoe flashes, limiting expandability, a factor to consider for the future-minded.

Battery and Memory: Staying Power for the Shoot

Although not monstrous, both battery lives suit weekend warriors. Carry spare batteries if your adventure demands.

Single SD card slots are standard; upgrade to fast cards for video or burst shoots.

Pros and Cons Summary

Olympus SH-2

Pros:

• Compact, lightweight, easily portable
• Superior sensor and image quality with better low-light handling
• Fast continuous shooting (11.5 fps)
• Touchscreen interface with touch AF
• Built-in WiFi connectivity
• Full HD 60p video with sensor-shift stabilization
• Macro focus down to 3 cm
• RAW file support

Cons:

• Limited zoom reach (600 mm vs. competitor’s 924 mm)
• No external mic/headphone ports for video
• No viewfinder
• Price nearly double the LZ40

Panasonic LZ40

Pros:

• Massive zoom range (22-924 mm), great for distant subjects
• Longer macro focusing distance (1 cm)
• Microphone input for video recording
• Traditional button layout might appeal to some users
• Lower price point, excellent value for basic superzoom needs

Cons:

• Larger, heavier, less portable
• CCD sensor with poorer low-light and ISO performance
• Single-frame continuous shooting (1 fps)
• No touchscreen or WiFi
• Limited video resolution (720p max)
• No RAW support

Who Should Buy Which Camera?

• Buy the Olympus SH-2 if:
  You want a reliable, versatile superzoom camera that fits in a pocket, delivers good image quality, handles a variety of shooting scenarios well (portraits, landscapes, street), and values modern features like touchscreen and wireless transfer. It’s well-suited for travelers, keen beginners, and casual enthusiasts who don’t want to lug a large bridge-style rig.

• Buy the Panasonic LZ40 if:
  You’re a budget-conscious buyer craving extreme zoom in a budget-friendly package and don’t mind compromised image quality or slower performance. If your main goal is just to snatch distant shots or you prioritize video audio inputs within a modest budget, the LZ40 fits the bill.

Wrapping Up: Which Superzoom Wins the Day?

In my hands, the Olympus SH-2 is the more refined tool - a compact powerhouse that punches above its small sensor stature. It strikes a strong balance between performance, control, and convenience with a modern user interface and state-of-the-art image stabilization.

The Panasonic LZ40 feels more like a throwback bridge camera designed to let zoom-hungry shooters reach far, sacrificing speed, low-light ability, and handling in the process.

If your budget allows and you want an all-rounder for everyday photography with moments of action, low light, and travel, go for the Olympus SH-2. If you’re a cheapskate zoom enthusiast or a niche macro shooter willing to accept tradeoffs, Panasonic’s LZ40 answers that call.

Both have their place, but for real-world versatility, I tip my hat to the Olympus here.

Happy shooting and zooming - whichever side of the fence you land on!