Ciena (NYSE:CIEN) Shares Up 14.2% - Here's Why

Key Points

• Ciena shares jumped 14.2% to about $444.93, with trading volume rising 121% above the daily average.
• The company’s latest quarterly results beat expectations: adjusted earnings were $2.11 per share versus $1.73 expected, while revenue rose 37% year over year to $1.67 billion.
• Analysts maintain a “Moderate Buy” consensus with a $490.05 target price, although recent target reductions and insider selling provide some caution.

Ciena Corporation (NYSE:CIEN - Get Free Report)'s stock price rose 14.2% during trading on Tuesday. The stock traded as high as $446.37 and last traded at $444.9260. 6,369,217 shares were traded during mid-day trading, an increase of 121% from the average daily volume of 2,882,074 shares. The stock had previously closed at $389.69.

Wall Street Analysts Forecast Growth

A number of research firms have recently issued reports on CIEN. UBS Group lowered their target price on Ciena from $508.00 to $394.00 and set a "neutral" rating for the company in a research note on Friday, September 4th. Northland Securities set a $550.00 price objective on shares of Ciena in a research report on Thursday, September 17th. B. Riley Financial dropped their price objective on shares of Ciena from $516.00 to $413.00 and set a "neutral" rating on the stock in a research note on Monday, August 31st. CL King set a $347.00 target price on shares of Ciena in a research note on Friday, September 4th. Finally, Argus set a $550.00 price target on shares of Ciena in a report on Thursday, September 10th. One investment analyst has rated the stock with a Strong Buy rating, fifteen have given a Buy rating and five have given a Hold rating to the company. Based on data from MarketBeat, Ciena presently has a consensus rating of "Moderate Buy" and a consensus target price of $490.05.

Ciena Price Performance

The stock has a market capitalization of $63.09 billion, a P/E ratio of 99.31, a PEG ratio of 5.44 and a beta of 1.28. The company has a 50 day moving average of $372.86 and a 200-day moving average of $440.78. The company has a quick ratio of 3.17, a current ratio of 3.80 and a debt-to-equity ratio of 1.06.

Ciena (NYSE:CIEN - Get Free Report) last issued its earnings results on Thursday, September 3rd. The communications equipment provider reported $2.11 earnings per share for the quarter, topping analysts' consensus estimates of $1.73 by $0.38. Ciena had a net margin of 10.87% and a return on equity of 25.33%. The company had revenue of $1.67 billion for the quarter, compared to analysts' expectations of $1.64 billion. During the same period in the prior year, the company earned $0.35 earnings per share. The firm's revenue was up 37.0% compared to the same quarter last year. Sell-side analysts predict that Ciena Corporation will post 6 EPS for the current year.

Insider Transactions at Ciena

In other news, Director Bruce Claflin sold 2,857 shares of the stock in a transaction that occurred on Thursday, September 24th. The stock was sold at an average price of $355.91, for a total transaction of $1,016,834.87. Following the sale, the director directly owned 8,279 shares in the company, valued at approximately $2,946,578.89. This represents a 25.66% decrease in their position. The sale was disclosed in a document filed with the Securities & Exchange Commission, which can be accessed through the SEC website. Also, EVP Joseph Cumello sold 1,586 shares of the firm's stock in a transaction that occurred on Friday, September 25th. The stock was sold at an average price of $358.52, for a total value of $568,612.72. Following the completion of the sale, the executive vice president directly owned 39,570 shares in the company, valued at approximately $14,186,636.40. This trade represents a 3.85% decrease in their position. The disclosure for this sale is available in the SEC filing. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders have sold a total of 26,184 shares of company stock valued at $9,957,835 over the last ninety days. Insiders own 0.58% of the company's stock.

Institutional Investors Weigh In On Ciena

Large investors have recently added to or reduced their stakes in the stock. Andra AP fonden lifted its stake in Ciena by 250.6% in the second quarter. Andra AP fonden now owns 35,899 shares of the communications equipment provider's stock valued at $17,611,000 after buying an additional 25,660 shares during the last quarter. ABS Direct Equity Fund LLC grew its position in shares of Ciena by 22.6% during the second quarter. ABS Direct Equity Fund LLC now owns 981 shares of the communications equipment provider's stock worth $481,000 after acquiring an additional 181 shares during the last quarter. IPG Investment Advisors LLC acquired a new stake in shares of Ciena in the 2nd quarter worth about $312,000. Gemmer Asset Management LLC acquired a new stake in shares of Ciena in the 2nd quarter worth about $3,280,000. Finally, WINTON GROUP Ltd bought a new stake in Ciena in the 2nd quarter valued at about $14,835,000. 91.99% of the stock is owned by institutional investors and hedge funds.

Ciena Company Profile

Ciena Corporation is a networking technology company that provides communications infrastructure, software and services for telecommunications providers, cloud operators, enterprises, governments and research institutions. Its solutions are designed to help organizations build, manage and automate high-capacity networks that support applications such as cloud computing, broadband connectivity, data center interconnection and 5G services.

The company's portfolio includes optical networking systems and coherent optical technologies, routing and switching platforms, broadband access solutions, network management software and professional services.

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