Back to top

Image: Bigstock

Ciena (CIEN) Gains As Market Dips: What You Should Know

Read MoreHide Full Article

Ciena (CIEN - Free Report) closed the most recent trading day at $45.96, moving +0.04% from the previous trading session. This change outpaced the S&P 500's 0.16% loss on the day. Meanwhile, the Dow gained 0.11%, and the Nasdaq, a tech-heavy index, lost 0.44%.

Prior to today's trading, shares of the developer of high-speed networking technology had gained 10.43% over the past month. This has outpaced the Computer and Technology sector's gain of 6.51% and the S&P 500's gain of 4% in that time.

CIEN will be looking to display strength as it nears its next earnings release. In that report, analysts expect CIEN to post earnings of $0.57 per share. This would mark year-over-year growth of 18.75%. Our most recent consensus estimate is calling for quarterly revenue of $930.51 million, up 13.64% from the year-ago period.

CIEN's full-year Zacks Consensus Estimates are calling for earnings of $2 per share and revenue of $3.53 billion. These results would represent year-over-year changes of +43.88% and +14.02%, respectively.

It is also important to note the recent changes to analyst estimates for CIEN. These revisions help to show the ever-changing nature of near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.76% higher. CIEN is currently a Zacks Rank #2 (Buy).

Valuation is also important, so investors should note that CIEN has a Forward P/E ratio of 22.93 right now. This represents a premium compared to its industry's average Forward P/E of 21.52.

Meanwhile, CIEN's PEG ratio is currently 1.32. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. Fiber Optics stocks are, on average, holding a PEG ratio of 1.5 based on yesterday's closing prices.

The Fiber Optics industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 99, which puts it in the top 39% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow CIEN in the coming trading sessions, be sure to utilize Zacks.com.


See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


Ciena Corporation (CIEN) - free report >>

Published in