Ciena (CIEN) Gains But Lags Market: What You Should Know

Zacks Equity Research
·3-min read

In the latest trading session, Ciena (CIEN) closed at $43.99, marking a +1.45% move from the previous day. This move lagged the S&P 500's daily gain of 1.62%. Meanwhile, the Dow gained 1.54%, and the Nasdaq, a tech-heavy index, added 1.31%.

Prior to today's trading, shares of the developer of high-speed networking technology had gained 6.88% over the past month. This has outpaced the Computer and Technology sector's gain of 2.55% and the S&P 500's gain of 3.4% in that time.

Wall Street will be looking for positivity from CIEN as it approaches its next earnings report date. This is expected to be December 10, 2020. The company is expected to report EPS of $0.63, up 8.62% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $828.61 million, down 14.4% from the prior-year quarter.

Investors might also notice recent changes to analyst estimates for CIEN. These revisions help to show the ever-changing nature of near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Within the past 30 days, our consensus EPS projection remained stagnant. CIEN currently has a Zacks Rank of #4 (Sell).

Investors should also note CIEN's current valuation metrics, including its Forward P/E ratio of 16.19. Its industry sports an average Forward P/E of 16.19, so we one might conclude that CIEN is trading at a no noticeable deviation comparatively.

Investors should also note that CIEN has a PEG ratio of 1.01 right now. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The Fiber Optics was holding an average PEG ratio of 1.01 at yesterday's closing price.

The Fiber Optics industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 249, which puts it in the bottom 2% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Make sure to utilize Zacks. Com to follow all of these stock-moving metrics, and more, in the coming trading sessions.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Ciena Corporation (CIEN) : Free Stock Analysis Report
To read this article on click here.
Zacks Investment Research