Ciena Corporation (CIEN): A Bull Case Theory 

We came across a bullish thesis on Ciena Corporation on Make Money, Make Time’s Substack by Oliver | MMMT Wealth. In this article, we will summarize the bulls’ thesis on CIEN. Ciena Corporation’s share was trading at $209.84 as of December 16th. CIEN’s trailing and forward P/E were 246.87 and 48.54 respectively according to Yahoo Finance.

Ciena Corporation, a network technology company, provides hardware, software, and services for various network operators in the Americas, Europe, the Middle East, Africa, the Asia Pacific, Japan, and India. CIEN is positioned as a critical enabler of next-generation network infrastructure, focused on high-performance optical networking solutions that address surging bandwidth demand from cloud providers, telecom operators, and increasingly, data centers. The company designs advanced optical transceivers and digital signal processors powered by its WaveLogic 6 platform, which maximizes capacity, reach, and power efficiency across long-haul, metro, and subsea networks.

This technological leadership places Ciena at the center of accelerating data traffic driven by AI workloads, cloud migration, and video consumption. The recent acquisition of Nubis in September 2025 strategically expands Ciena’s addressable market into shorter-reach data center interconnect optics, allowing the company to participate more directly in east-west data center traffic and complement its historical strength in long-distance optical transport.

Financially, Ciena is entering a strong operating leverage phase. Revenue is estimated to grow 16.7% in FY26, reflecting improving carrier spending cycles and incremental contribution from data center optics. More importantly, EBITDA is expected to grow 48.5% over the same period, highlighting margin expansion as volumes scale and fixed costs are leveraged. Net income margins of approximately 8% indicate improving profitability, though still with room for further expansion as higher-margin platforms gain mix share.

From a valuation perspective, the market is assigning a premium multiple to Ciena’s growth and technology leadership, with the stock trading at 5.9x NTM EV/Sales, 37.6x NTM EV/EBITDA, and 58.6x NTM P/E. While these multiples appear elevated on current earnings, they reflect expectations for sustained growth, margin expansion, and Ciena’s strategic positioning in optical networking. Overall, CIEN represents a growth-oriented infrastructure play, offering leveraged upside to bandwidth demand trends, albeit with valuation sensitivity tied to execution and industry spending cycles.

Previously we covered a bullish thesis on Cisco Systems, Inc. by Kroker Equity Research in May 2025, which highlighted the company’s transformation toward recurring software revenue, AI infrastructure growth, and the Splunk acquisition. The company’s stock price has appreciated approximately by 228.28% since our coverage. This is because AI-driven networking demand accelerated. The thesis still stands as execution remains strong. Oliver | MMMT Wealth shares a similar thesis but emphasizes optical networking-led growth at Ciena.

Ciena Corporation is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 70 hedge fund portfolios held CIEN at the end of the third quarter which was 57 in the previous quarter. While we acknowledge the risk and potential of CIEN as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than CIEN and that has 10,000% upside potential, check out our report about this cheapest AI stock.

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Disclosure: None.