CIEN - Ciena Corporation

[perulv]

I had not heard of this company before it popped up in a screener today, but I understand it has been around for a while (before dotcom). It seems interesting:

 

- Steadily growing earnings for the last decade

- pretty cheap (EV/Ebit around 11 according to finbox.com)

- ROA a bit under 10%

- Pretty low on debt

- Operates in an industry that is probably not smaller tomorrow ("Ciena Corporation provides network hardware, software, and services that support the transport, switching, aggregation, service delivery, and management of video, data, and voice traffic on communications networks worldwide.")

 

So, a company (a "tech stock", even) with (historically) growing profits in a growing market, reasonably priced. The short term outlook might not be great (https://www.fool.com/investing/2020/09/08/high-flying-tech-stock-on-sale-after-big-crash/), but hopefully that is priced in now.

 

 

[GordonGekko69]

I have CIEN as optical network supplier on my watchlist since price dropped massive after earningscall and a moderate outlook due to expected cuts in networkspending of customers. Still trying to fully understand the business. Since the need for bandwith growth is and will consistantly grow due to 5G, Datacenters, IOT etc. and Huawei is banned from many markets I believe they can use their technology leadershiop to expand market share. CIEN has the first 800G modem (now with infinera). CIEN is supporting open network structures which I believe will be future. I guess the future growth driver will be the blue planet software which is able to maintain and operate open 5G networks. With all that different applications running through future 5G networks I believe network slicing and network operation/maintanance will be a good slice of the future business. Telefonica recently made a deal with ciena to operate the telefonica 5G network via cienas blue planet software. Interesting business which needs more digging.

 

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