Morgan Stanley raised the firm’s price target on Ciena (CIEN) to $73 from $44 and keeps an Equal Weight rating on the shares. Fiscal Q2 was “much better than expected on the top-line,” as cloud continues to be a source of strength, but the beat was from lower margin pluggables/RLS systems, which caused a shortfall on the bottom line, the analyst noted. With both trends set to continue in the near-term, the firm remains Equal Weight given its view that valuation is “full,” the analyst tells investors. The firm could turn more positive were margins of pluggables to improve with 800ZR, but for now it remains on the sidelines, the analyst added.
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