Back to top

Image: Bigstock

Ciena to Report Q3 Earnings: What to Expect From the Stock?

Read MoreHide Full Article

Ciena Corporation (CIEN - Free Report) is scheduled to report third-quarter fiscal 2024 results on Sept. 4. 

The Zacks Consensus Estimate for earnings is pegged at 26 cents per share, implying a 55.9% decrease from the year-ago level.

For the fiscal third quarter, management expects revenues in the range of $880-$960 million. The consensus estimate for revenues is pegged at $927.5 million, indicating a decline of 13.2% from the prior-year level.

CIEN has a trailing four-quarter earnings surprise of 35.5%, on average. Shares of Ciena have gained 13.5% in the past year compared with the sub-industry's growth of 13.2%.

Zacks Investment Research
Image Source: Zacks Investment Research

Factors to Note for CIEN

CIEN’s performance in the fiscal third quarter is likely to have been affected by the slower-than-expected normalization of order volumes from the service providers. Macroeconomic concerns are likely to have resulted in lower order volumes from service providers in certain international geographies. 

Inflation and higher expenses on product development amid stiff competition in the networking space are expected to have further limited margin expansion in the quarter under review.

For the fiscal third quarter, revenues from Networking Platforms and Global services are expected to be down 18.1% and 2.4%, respectively, year over year. 

CIEN is one of the leading providers of optical networking equipment, software and services. The company’s performance is likely to have been cushioned by the demand for bandwidth (especially driven by the proliferation of AI applications), the increase in traffic and the adoption of cloud architectures.

Ciena Corporation Price and EPS Surprise

Ciena Corporation Price and EPS Surprise

Ciena Corporation price-eps-surprise | Ciena Corporation Quote

Apart from increasing demand for its solutions in the 5G, cloud, AI and automation space, CIEN is investing extensively to grab opportunities in fast-growing markets in the next-gen metro and edge solutions. CIEN’s routing and switching solutions are likely to have witnessed strong uptake.

Strong momentum for WaveLogic 5 Extreme and 6500 RLS, driven by cloud provider network expansions, is likely to have acted as a tailwind. In the fiscal second quarter, the company added 20 new customers for WaveLogic 5 Extreme, bringing the total customer count to 290.

What Our Model Says

Our proven model does not conclusively predict an earnings beat for CIEN in this earnings season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. This is not the case here.

CIEN has an Earnings ESP of 0.00% and a Zacks Rank #3 at present. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
 

Stocks to Consider

Here are some stocks that you may consider, as our model shows that these have the right combination of elements to beat on earnings this season.

DICK'S Sporting Goods, Inc. (DKS - Free Report) has an Earnings ESP of +3.90% and is set to announce quarterly figures on Sept. 4. DKS currently has a Zacks Rank of 2. You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for DKS’ to-be-reported quarter’s earnings and revenues is pegged at $3.76 per share and $3.43 billion, respectively. Shares of DKS have risen 102.1% in the past year.

Casey's General Stores, Inc. (CASY - Free Report) presently has an Earnings ESP of +0.21% and a Zacks Rank #3. CASY is slated to release quarterly numbers on Sept. 4. The Zacks Consensus Estimate for BURL’s to-be-reported quarter’s earnings and revenues is pegged at $4.50 per share and $4.11 billion, respectively. Shares of CASY have gained 46.8% in the past year.

FedEx Corporation (FDX - Free Report) currently has an Earnings ESP of +1.56% and a Zacks Rank #3. FDX is scheduled to report quarterly earnings on Sept. 19. The Zacks Consensus Estimate for FDX’s to-be-reported quarter’s earnings and revenues is pegged at $4.92 per share and $22.2 billion, respectively. Shares of FDX have surged 13.5% in the past year.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.

Published in