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Ciena Q3 Seen Swinging To Profits On 18% Revenue Growth

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Ciena (NYSE: CIEN), which has seen a string of losses and fluctuating revenue in recent quarters, is set to post results for its fiscal third period September 4.

The telecom infrastructure company -- shares are down more than 16 percent year to date -- is expected to swing to earnings of $0.10 per share, from a loss of $0.27 per share a year earlier and a loss of $0.10 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 seven 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 closed Monday at $19.93, up 0.45 percent.

Latest Ratings for CIEN

Jan 2018Goldman SachsUpgradesNeutralBuy
Dec 2017PiperJaffrayDowngradesOverweightNeutral
Nov 2017Bank of AmericaUpgradesNeutralBuy

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Posted-In: Brian ModoffAnalyst Color Earnings News Guidance Price Target Reiteration Analyst Ratings


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