During the October 5 lightning round of Mad Money, a caller asked Jim Cramer about Ciena Corporation (NYSE:CIEN). He replied:
I think Ciena’s very good. I happen to like optical. You know, the one that I had liked for the Club was Corning. I’m waiting for it to come down to be able to get back in. It never seems to come in.
His reluctance to chase Corning is not new. In September, Cramer gave a more specific reason for waiting, despite describing the business as good.
AI Network Spending Reaches Both Businesses
Ciena Corporation and Corning Incorporated (NYSE:GLW) benefit from different parts of optical infrastructure. Ciena supplies optical networking systems and interconnect technology, while Corning supplies fiber, cable, and connectivity products. Their latest results show strong demand across both areas. Cramer’s view of Corning’s opportunity also reaches beyond today’s fiber connections. His July comments during a broader market rotation pointed to another potential use for fiber within data centers.
Ciena’s fiscal third-quarter 2026 revenue increased 37% to approximately $1.67 billion. Adjusted EPS rose to $2.11 from $0.67, while its adjusted operating margin expanded to 22.5% from 10.7%. Management linked the performance to AI-driven network investment and expanding supply capacity. Ciena’s own results are not the only source of optimism. Its October 6 rally followed an optical-growth forecast from a peer that put the company’s longer-term targets in a different light.
Corning’s second-quarter Optical Communications sales rose 32% to approximately $2.07 billion, including 65% growth in Enterprise Networks. The segment generated $438 million in net income, up 77%. Corning also reported a multiyear supply agreement with Amazon and a partnership with NVIDIA involving major expansions of its U.S. optical connectivity and fiber manufacturing capacity. Previously, Cramer remained bullish even after Corning’s sharp third-quarter decline. His earlier explanation for sticking with the fiber story traced that conviction to a factory visit.
Strong Demand Comes With High Expectations
The valuations leave little room to describe either stock as inexpensive. Ciena Corporation trades at approximately 42.9x forward earnings, compared with 45.6x for Corning. Ciena carried the slightly lower multiple, but both valuations reflect expectations of significant future earnings. Their different products and Corning’s additional businesses also limit a direct comparison.
Ciena’s customer concentration is another consideration. Two customers together represented 41.7% of fiscal third-quarter revenue. The company also identified supply constraints and the timing of large orders as risks, making delivery schedules and spending decisions at major customers especially important.
Corning Incorporated’s performance is not uniform across its portfolio. Its Solar segment reported a $7 million second-quarter loss despite sales increasing 90% to $438 million. The company had completed an extended maintenance shutdown and equipment upgrade and expected profitability to improve in the third quarter. That improvement remained a forecast at the time of the report.
Both Companies Attract More Hedge Funds
Insider Monkey’s second-quarter figures showed 81 hedge funds holding Ciena Corporation, up from 73 in the first quarter. Corning Incorporated also gained eight holders, rising to 99 from 91. Short interest data placed Ciena at roughly 2.5% – 2.6% of the float and Corning at approximately 2.23%. The figures show modest short positioning alongside the increase in hedge fund holders.
Cramer likes the optical opportunity, but his willingness to wait on Corning makes the entry price part of the story. Both companies are already reporting strong growth. With forward earnings multiples above 40, investors are also paying for that growth to continue well beyond the latest quarter.
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