Ciena Corporation (CIEN) Proves That Myopia Doesn’t Deserve a Place in Investing: AT&T Inc. (T), JDS Uniphase Corp (JDSU)

Page 1 of 2

If you want to see some real life, zero-turns-hero instances, look no further than the stock markets. Just six months back, analysts were critical of communications equipment maker Ciena Corporation (NASDAQ:CIEN), slapping the stock with rating downgrades. Even myopic investors had joined them then, after the stock missed estimates and panic selling shaved 20% off its market capitalization. But, Ciena’s business is such that it would ultimately do well, even though it might witness short-term pain.

Ciena (CIEN)Thus, I knew that value investors would have jumped onto the stock after that sell-off in September and they are now sitting on gains of almost 30%. Ciena Corporation (NASDAQ:CIEN) has made a heroic comeback since, outsmarting the army of analysts who were expecting it to post a loss in the recently-reported first quarter, and soaring more than 17% in the wake of terrific results as Fool analyst Brian D. Pacampara pointed out. And unsurprisingly, there’s a lot of optimism around the stock.

Why Ciena was never in trouble

As Brian pointed out in his article, there were concerns about Ciena’s business being hit due to tepid demand, and this had kept the stock subdued this year before it busted those myths in its latest report. How could’ve the Street expected Ciena Corporation (NASDAQ:CIEN) to slowdown this year is a mystery to me, since there have been some concrete indications in the past few months that the stock should have another successful year.

When telco giant AT&T Inc. (NYSE:T) sounded out is intention of stepping on the gas to roll out faster networks aggressively, Ciena’s prospects had brightened up since Ma Bell is a 10%-plus customer. AT&T intends to provide LTE coverage to 300 million customers by the end of next year, and the company would be investing $14 billion over three years to upgrade its wireless and wireline networks. Moreover, AT&T Inc. (NYSE:T) expects total capex to be $22 billion a year for the next three years, which is great news for Ciena Corporation (NASDAQ:CIEN).

And finally, when optical networker JDS Uniphase Corp (NASDAQ:JDSU) came out with a stunning quarterly report earlier this year, it became clear that networking stocks are in for a good time. Uniphase’s strong execution, product development moves, and an upswing in capital spending by telecom companies led management to forecast a better year. Ciena’s results and outlook further prove that the recovery is not baseless, and this is the reason why optical networking stocks, including JDS Uniphase Corp (NASDAQ:JDSU), should have a good time.

Page 1 of 2

Biotech Insider Alert - $6 Stock To Hit $40

$200 Million Dollar Healthcare Hedge Fund's #1 Best Idea Right Now

The best healthcare hedge fund out there right now is one of the largest shareholders in this biotech stock. The fund returned more than 20% in each of the last 2 years with a virtually fully hedged portfolio, and it's sending out a BUY signal on this biotech stock. Get your FREE REPORT today (retail value of $300)

This is a FREE report from Insider Monkey. Credit Card is NOT required.
Click here to Read Comments
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 74 percentage points in 2.5 years. Our beta is only 1.2 (download a FREE newsletter and see the details inside)

Lists

Best Selling Magazines in the World

Shortest People in History

The Most Celebrated Holidays in the World

Most Expensive Handbag Brands in the World

Top Selling Comic Book Issues of this Century

The Most Powerful Women in Politics

Best Paid DJs

Most Rebellious Female Artists

Best Paid TV Actresses of 2014

Best Paid Actors of 2014

Most Expensive Horses in the World

Tallest People Ever

Most Encouraging Feminist Celebrities

Best Paid Supermodels of 2014

Top 10 Suburbs for Retirement in 2015

10 Wealthiest Cities in America

Top 10 TED Talks for Entrepreneurs

Best TED Talks on Education

25 Most Dangerous Places to Live in America

Top 10 Ski Resorts in the United States – 2014 List

Top 10 Most Remote Places in the World

Most Visited Museums in the United States

Wealthiest Photographers in the World

Most Famous Gay Athletes

The World’s Most Famous Circuses

Best Hair Stylists

Most Popular NASCAR Drivers

The Best Romance Movies of all Time

The Most Wanted Drug Lords

The Oldest Money Managers

The Greatest Directors in the World

Largest Animals in the World

World’s Most Expensive Desserts

Best Selling Comic Books of All Time

A-list Actors who Sabotaged Their Career

Rappers With a College Degree

The Best Jazz Albums of all Time

The Most Influential Jazz Musicians

The World’s Most Famous Photographers

The Best Oscar-Winning Songs

Most Influential Choreographers Ever

Most Expensive Department Stores in the World

The Most Expensive Stolen Paintings in the World

The World’s Most Expensive Teas

Top Oscar Record Holders

The Most Expensive Flowers in the World

Countries With a Booming Film Industry

Most Expensive Cupcakes in the World

Uncommon European Escapes

The Most Stolen Artists in History

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 129% in 2.5 years!! Wondering How?

Download a complete edition of our newsletter for free!