Ciena Corp Q3 Seen Swining To Profits On 18% Revenue Growth

Ciena Corp.

which has seen a string of losses and fluctuating revenue in recent quarters is set to post results for its fiscal third period Sept. 4. The telecom infrastructure company whose shares are down more than 16 percent in the year to date, is expected to swing to earnings of $0.10 cents a share, from a loss of $0.27 cents a share a year earlier and a loss of $0.10 cents in the most recent quarter. Deutsche Bank's Brian Modoff expects revenue derived from non-telecom sources like cloud computing and data centers will continue to grow, hitting 25 percent of the company's expected $600.8 million of third-quarter revenue. The consensus revenue expectation equals 18 percent growth from a year earlier and 7 percent sequentially. Modoff thinks non-telecom revenue could drive a slight revenue surprise for both the third quarter and fourth period outlook. But on the core telecom side, AT&T

is expected to launch an upgrade to its network during the second half of calendar 2015, creating demand for Ciena's relatively high-margin Ethernet switches. "Ciena is in a share gain mode relative to its peers," Modoff said, citing a number of significant recent orders. Those orders, in Modoff's view could lead to further business in Europe and Asia in 2015. Modoff rates the stock a Buy with a $30 target. Ciena traded recently at $19.93 a share, up $0.09 cents.