- Ciena Corp CIEN reports quarterly results on September 1 before the market opens.
- Needham analyst Alex Henderson expects another supply-constrained quarter, with Orders above Shipments and Revenues modestly ahead of forecast.
- He reiterated a Buy and price target of $88.
- For the October quarter, the analyst thinks the Street Q/Q growth forecast looks a bit aggressive with Product Sales up 25%-30% Q/Q, not on demand, but supply.
- He thinks the Q/Q growth in Product Sales implied by the Street estimate may be hard to achieve even with improving supply.
- Conversely, he thinks 1Q23 will be up Q/Q while the Street has it down.
- He thinks it's only a matter of time till the large and still growing backlog translates into substantial Revenue and EPS.
- Service Revenue will likely grow in the quarter, partially offsetting the decline in Product Sales.
- He thinks CIEN looks better positioned in a rising interest rate environment than most names.
- Price Action: CIEN shares traded lower by 1.94% at $52.58 on the last check Monday.
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