Ciena (CIEN) AI Stock Analysis

• Market Cap: $16.46B
• Dividend Yield: N/A
• Average Volume (3M): 2.26M
• Price to Earnings (P/E): 122.9
• Beta (1Y): 1.70
• Revenue Growth: 12.97%
• EPS Growth: 4.71%
• Country: US
• Employees: 8,795
• Sector: Technology
• Sector Strength: 81
• Industry: Communication Equipment
• EPS (TTM): 0.67
• Shares Outstanding: 141,055,910
• 10 Day Avg. Volume: 3,563,453
• 30 Day Avg. Volume: 2,258,735
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 0.79
• Enterprise Value/Revenue: 2.88
• Enterprise Value/Gross Profit: 7.28
• Enterprise Value/Ebitda: 30.47
• 1Y Price Target: $122.58
• Price Target Upside: 3.01% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 14

• Rating: 76 Outperform
• Price Target: $132.00 ▲(10.92% Upside)

Ciena's strong financial performance and positive earnings call sentiment are the most significant factors driving the score. The technical analysis supports a bullish outlook, although the high P/E ratio suggests overvaluation concerns. The absence of corporate events and dividend yield slightly detracts from the overall attractiveness.

Positive Factors

Growth and Revenue

Ciena is providing investors with visibility into next year earlier than typical and guiding to another robust year of 17% growth in FY26.

Technology Leadership

CIEN is delivering impressive share gains and solidifying its leadership position in the hyper-growth AI/cloud segment.

Negative Factors

Capex Slowdown Risks

Some risk is associated with any potential capex slowdown next year, though it is believed the risk is relatively mitigated given prior under-investments in WAN infrastructure.

Valuation Concerns

Valuation remains stretched, but given competitive positioning, stock to trade closer to bull case in the near term.

Ciena Business Overview & Revenue Model

Company Description

Ciena Corporation provides network hardware, software, and services that support the transport, routing, switching, aggregation, service delivery, and management of video, data, and voice traffic on communications networks worldwide. The company's Networking Platforms segment offers hardware networking products and solutions that optimized for the convergence of coherent optical transport, optical transport network switching, and packet switching. Its products include 6500 Packet-Optical Platform, 5430 Reconfigurable Switching System, Waveserver stackable interconnect system, and the 6500 Reconfigurable line system, and the 5400 family of Packet-Optical platforms, as well as Z-Series Packet-Optical Platform; 3000 family of service delivery switches and service aggregation switches, and the 5000 family of service aggregation switches, as well as 8700 Packetwave Platform and the Ethernet packet configuration for the 5410 Service Aggregation Switch; and 6500 Packet Transport System. This segment also sells operating system software and enhanced software features embedded in each of its products. The company's Blue Planet Automation Software and Services segment provides multi-domain service orchestration, inventory, route optimization and analysis, network function virtualization orchestration, analytics, and related services. Its Platform Software and Service segment offers OneControl unified management system and platform software services, as well as manage, control, and plan software. The company's Global Services segment provides consulting and network design, installation and deployment, maintenance support, and training services. The company sells its products through direct and indirect sales channels to network operators. Ciena Corporation was founded in 1992 and is headquartered in Hanover, Maryland.

How the Company Makes Money

Ciena generates revenue through the sale of its networking equipment, software, and associated services. The primary revenue streams include the sale of hardware products such as optical transport systems and packet networking devices, which are critical for telecommunications providers and data center operators. Additionally, Ciena earns income from software services, particularly in areas like SDN and network management, which help customers optimize their networks. The company also provides maintenance and support services that contribute to its recurring revenue model. Strategic partnerships with telecom operators and technology providers further bolster its earnings, allowing Ciena to integrate its solutions into larger network deployments and benefit from long-term contracts.

Ciena Financial Statement Overview

Summary

Ciena demonstrates solid revenue growth and a healthy gross profit margin, but profitability margins are modest. The balance sheet shows manageable leverage and strong equity support, while cash flow generation is strong despite a recent decline in free cash flow.

Income Statement

Ciena demonstrated solid revenue growth with a 6.22% increase in TTM (Trailing-Twelve-Months) revenue compared to the previous annual period. Gross profit margin remained healthy at 41.94% TTM, although net profit margin is modest at 2.46%. The EBIT margin is relatively low at 4.68% TTM, indicating room for operational efficiency improvements.

Balance Sheet

The company's balance sheet shows a moderate debt-to-equity ratio of 0.57, reflecting manageable leverage. Return on equity stands at 3.77% TTM, suggesting modest returns to shareholders. Equity ratio is strong at 49.05%, indicating a solid equity position relative to total assets.

Cash Flow

Free cash flow decreased by 22.71% in the TTM period, which may raise concerns about cash generation. However, the operating cash flow to net income ratio is favorable at 4.30, indicating strong cash flow from operations relative to net income. The free cash flow to net income ratio is also solid at 2.79.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	4.54B	4.01B	4.39B	3.63B	3.62B	3.53B
Gross Profit	1.79B	1.72B	1.75B	1.43B	1.60B	1.54B
EBITDA	428.87M	324.68M	553.86M	369.76M	625.85M	619.81M
Net Income	140.88M	83.96M	254.83M	152.90M	500.20M	361.29M
Balance Sheet
Total Assets	5.75B	5.64B	5.60B	5.07B	4.87B	4.18B
Cash, Cash Equivalents and Short-Term Investments	1.33B	1.25B	1.12B	1.15B	1.60B	1.24B
Total Debt	256.75M	1.63B	1.66B	1.13B	737.48M	763.74M
Total Liabilities	2.96B	2.83B	2.75B	2.36B	1.85B	1.67B
Stockholders Equity	2.79B	2.82B	2.85B	2.71B	3.02B	2.51B
Cash Flow
Free Cash Flow	700.83M	377.89M	62.13M	-258.57M	462.10M	410.99M
Operating Cash Flow	784.38M	514.53M	168.33M	-167.76M	541.65M	493.65M
Investing Cash Flow	-176.66M	-306.48M	-383.45M	-101.25M	-90.72M	-220.24M
Financing Cash Flow	-434.82M	-285.06M	229.38M	-133.06M	-116.83M	-87.22M

Ciena Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 119.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CIEN, the sentiment is Positive. The current price of 119 is above the 20-day moving average (MA) of 95.95, above the 50-day MA of 89.86, and above the 200-day MA of 79.23, indicating a bullish trend. The MACD of 6.01 indicates Negative momentum. The RSI at 79.04 is Negative, neither overbought nor oversold. The STOCH value of 86.57 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for CIEN.

Ciena Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CIEN	76 Outperform	$16.46B	122.91	4.96%	―	12.97%	4.71%
CSCO	75 Outperform	$264.47B	26.27	22.65%	2.42%	5.30%	3.07%
JNPR	71 Outperform		―		―	-2.56%	52.05%
ERIC	69 Neutral	$26.97B	15.98	19.63%	3.45%	0.98%	―
LITE	65 Neutral	$10.45B	633.84	2.48%	―	21.03%	―
NOK	62 Neutral	$24.51B	23.36	4.31%	3.37%	-2.39%	157.33%
Sector *	61 Neutral	$35.56B	9.00	-10.49%	1.86%	8.45%	-8.32%

Ciena Corporate Events

Ciena Appoints New CFO Amid Leadership Transition

Ciena Corporation announced the appointment of Marc D. Graff as Senior Vice President and Chief Financial Officer, effective August 1, 2025. With nearly 30 years of global finance experience, Graff brings extensive expertise in data center-related technologies. His leadership is expected to drive Ciena’s financial strategy and operations, supporting growth in high-speed connectivity demand fueled by AI and cloud computing. This appointment follows the planned retirement of the current CFO, James E. Moylan, Jr., on August 28, 2025.