Ciena (CIEN): A Buy After Earnings

Page 1 of 2

Ciena Corporation (NASDAQ:CIEN) is up 5% this week following its latest earnings announcement. Ciena reported quarterly revenue up 2% year over year, but still posted a net loss of $0.39 per share. Ciena did reveal a solid backlog, which coupled with a rebounding economy, should allow the company to post positive earnings next fiscal year. The fundamental driver of Ciena’s demand is the continued rise in bandwidth consumption. Ciena’s focus on helping carriers transition to next generation networks places it in one of the fastest growing segments of the telecommunications market.

Ciena is a leading supplier of optical transport technology and saw FY2011 (ended in Oct.) sales come in 40% higher YOY, driven by its 2010 acquisition of Nortel’s Metro Ethernet Networking segment. Ciena has made several acquisitions to expand its addressable market and enter new growth areas, with a key buy of Nortel Network and its optical networking capabilities. This acquisition expanded Ciena’s products portfolio and global reach, pushing it into the emerging markets of Asia and Africa.

Ken Griffin CITADEL INVESTMENT GROUP

Ciena has significantly expanded its operating market by shifting to data networking from optical networking over the last few years. This has helped Ciena enter a broader optical and data-equipment market. Ciena is increasingly investing in this area to “capture” the tremendous growth opportunity presented by rising bandwidth demand from network service providers. Billionaire Ken Griffin – founder of Citadel Investment Group – is one of Ciena’s big name investors (check out Ken Griffin’s newest picks).

Ericsson (NASDAQ:ERIC) pays a high dividend yield (for the communication industry) at 3.6%. This could be due to the company’s less-than-stellar expected growth rate; by offering a robust dividend yield Ericsson is able to keep shareholders’ interest. The sell-side expects annual earnings to grow by roughly 9% a year over the next half-decade; this is below Ciena by six full percentage points. Ericsson had billionaire Ken Fisher – founder of Fisher Asset Management – as one of its key income-seeking investors last quarter (see Ken Fisher’s top tech bets).

Juniper Networks, Inc. (NYSE:JNPR) is up over 10% this week after seeing an upgrade at Cantor Fitzgerald, partially due to an announcement to acquire the remainder of its unowned Contrail shares. Despite three straight quarterly earnings beats, Juniper is still relatively flat year to date, but is neither a value –17x earnings–, nor a growth –13.5% long term growth rate– play. Ray Dalio of Bridgewater Associates gave Juniper a vote of confidence last quarter by taking a new position in the stock (see Dalio’s other big bets).

Page 1 of 2
blog comments powered by Disqus
Insider Monkey Headlines
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 52 percentage points in 24 months. Our beta is only 1.2 (don't click this link if beating the market isn't important to you).

Lists

Rito Pls Buff: The 10 Least Played Champions in LoL Season 4

10 Covers of Popular Songs that are Better than the Originals

Must See TV: The 9 Most Anticipated Shows of 2015

The 15 Biggest Box Office Bombs of All Time

10 Things The World Can’t Stand About Americans

Picture Perfect: The 6 Smartphones with the Best Cameras

The 10 Best Countries To Work In the World

A Profitable Day At The Track: 5 Tips For Betting On Horses

Tearing You Apart: 6 Bad Habits That Ruin Relationships

Learning on the Job: The 6 Biggest Mistakes Parents Make

Shopaholics Rejoice: The 12 Biggest Malls in the World

Fright Night: 10 Horror Movies Based on True Stories

Mach Mania: The 10 Fastest Jets in the World

Military Heavyweights: The 10 Countries with the Most Tanks

All In: The 7 Richest Poker Players in the World

Abracadabra: The 10 Best Magicians in the World

The 10 Richest Asian Countries in the World in 2014

Eyes in the Sky: 10 Things You Need to Know About Drones

Rising Stars: The 6 Best Silicon Valley Startups

Military Muscle: The 5 Most Advanced Armies in South America

All that Glitters: The 7 Most Luxurious Jewelry Brands in the World

5 Things You Didn’t Know About ISIS but Should

Empowering Your Money: The 5 Best Energy Stocks to Invest In

The 11 Best Android Apps You Can’t Get on iOS

The 10 Most Important International Conflicts in 2014

Mood Enhancers: The 20 Most Uplifting Songs of all Time

Lover Beware: The 8 Countries that Cheat the Most

Breath of Fresh Air: The 25 Countries with the Best Air Quality on the Planet

Singles Beware: The 8 Worst Mistakes Made on First Dates

Healthy and Happy: The 10 Countries with Lowest Healthcare Costs

The 6 Best Company Team Building Activities to Build Workplace Camaraderie

Ships Ahoy: The 10 Busiest Shipping Ports in the World

10 Productivity Tips to Save You Time and Help You Do More With Less

Grab a Bite: The Most Popular Fast Food Restaurants in America

Friday Night Thirst: The 10 Most Popular Cocktails in the World

The 6 Greatest Unsolved Mysteries We May Never Figure Out

7 Useless Products You Never Should’ve Bought

The 5 Reasons Why You’re Single and Miserable

The 7 Most Addictive Foods in the World We Can’t Stop Eating (Even Though We Should)

5 Amazing Places You Can Swim with Dolphins

The Top 7 Most Livable Countries In The World

The 10 Most Expensive Baseball Cards Ever Pulled From A Pack

The 5 Easiest Second Languages to Learn for English Speakers

Silver Spoon: The 6 Richest Families in the World

The 20 Countries with the Largest Prison Populations in the World

The Top 10 Richest Actors in the World

The 10 Best Airline Stocks to Invest In Before They Fly Too High

Burger Kings: The 10 Most Expensive Burgers in the World

The 10 Most Ethnically Diverse Countries in the World

The 10 Most Exclusive Credit Cards in the World

Subscribe

Enter your email:

Delivered by FeedBurner

X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 47.6% in its first year! Wondering How?

Download a complete edition of our newsletter for free!