NYSE:CIEN

Stock Analysis Report

Executive Summary

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.


Snowflake Analysis

Flawless balance sheet with acceptable track record.


Similar Companies

Share Price & News

How has Ciena's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: CIEN has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

1.6%

CIEN

-1.1%

US Communications

-1.1%

US Market


1 Year Return

0.7%

CIEN

-8.6%

US Communications

17.9%

US Market

Return vs Industry: CIEN exceeded the US Communications industry which returned -8.6% over the past year.

Return vs Market: CIEN underperformed the US Market which returned 17.9% over the past year.


Shareholder returns

CIENIndustryMarket
7 Day1.6%-1.1%-1.1%
30 Day1.4%-4.9%1.4%
90 Day17.6%1.7%6.9%
1 Year0.7%0.7%-6.7%-8.6%20.3%17.9%
3 Year70.4%70.4%30.6%22.3%47.8%38.3%
5 Year109.8%109.8%57.9%40.2%71.9%53.0%

Price Volatility Vs. Market

How volatile is Ciena's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Ciena undervalued compared to its fair value and its price relative to the market?

12.4%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: CIEN ($43.89) is trading below our estimate of fair value ($50.11)

Significantly Below Fair Value: CIEN is trading below fair value, but not by a significant amount.


Price To Earnings Ratio

PE vs Industry: CIEN is poor value based on its PE Ratio (27x) compared to the Communications industry average (24.7x).

PE vs Market: CIEN is poor value based on its PE Ratio (27x) compared to the US market (18.2x).


Price to Earnings Growth Ratio

PEG Ratio: CIEN is poor value based on its PEG Ratio (1.6x)


Price to Book Ratio

PB vs Industry: CIEN is overvalued based on its PB Ratio (3.1x) compared to the US Communications industry average (1.9x).


Next Steps

Future Growth

How is Ciena forecast to perform in the next 1 to 3 years based on estimates from 19 analysts?

16.6%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: CIEN's forecast earnings growth (16.6% per year) is above the savings rate (1.7%).

Earnings vs Market: CIEN's earnings (16.6% per year) are forecast to grow faster than the US market (14.1% per year).

High Growth Earnings: CIEN's earnings are forecast to grow, but not significantly.

Revenue vs Market: CIEN's revenue (5.6% per year) is forecast to grow slower than the US market (7.6% per year).

High Growth Revenue: CIEN's revenue (5.6% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: CIEN's Return on Equity is forecast to be low in 3 years time (15.9%).


Next Steps

Past Performance

How has Ciena performed over the past 5 years?

36.0%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: CIEN has high quality earnings.

Growing Profit Margin: CIEN became profitable in the past.


Past Earnings Growth Analysis

Earnings Trend: CIEN has become profitable over the past 5 years, growing earnings by 36% per year.

Accelerating Growth: CIEN has become profitable in the last year, making the earnings growth rate difficult to compare to its 5-year average.

Earnings vs Industry: CIEN has become profitable in the last year, making it difficult to compare its past year earnings growth to the Communications industry (-19.9%).


Return on Equity

High ROE: CIEN's Return on Equity (11.7%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Ciena's financial position?


Financial Position Analysis

Short Term Liabilities: CIEN's short term assets ($2.4B) exceed its short term liabilities ($845.9M).

Long Term Liabilities: CIEN's short term assets ($2.4B) exceed its long term liabilities ($874.6M).


Debt to Equity History and Analysis

Debt Level: CIEN's debt to equity ratio (32.6%) is considered satisfactory.

Reducing Debt: CIEN had negative shareholder equity 5 years ago, but is now positive and has therefore improved.

Debt Coverage: CIEN's debt is well covered by operating cash flow (58.3%).

Interest Coverage: CIEN's interest payments on its debt are well covered by EBIT (17.1x coverage).


Balance Sheet

Inventory Level: CIEN has a low level of unsold assets or inventory.

Debt Coverage by Assets: CIEN's debt is covered by short term assets (assets are 3.4x debt).


Next Steps

Dividend

What is Ciena's current dividend yield, its reliability and sustainability?


Dividend Yield vs Market

companyn/amarketbottom25%1.4%markettop25%3.7%industryaverage3.0%forecastin3Years0%

Current dividend yield vs market & industry

Notable Dividend: Unable to evaluate CIEN's dividend yield against the bottom 25% of dividend payers, as the company has not reported any payouts.

High Dividend: Unable to evaluate CIEN's dividend yield against the top 25% of dividend payers, as the company has not reported any payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if CIEN's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if CIEN's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of CIEN's dividend in 3 years as they are not forecast to pay a notable one for the US market.


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

9.4yrs

Average management tenure


CEO

Gary Smith (59yo)

18.8yrs

Tenure

US$11,016,365

Compensation

Mr. Gary B. Smith has been Principal Executive Officer of Cyan, Inc. since August 3, 2015. Mr. Smith serves as the Chief Executive Officer and President of Ciena Corporation since May 2001. He served as th ...


CEO Compensation Analysis

Compensation vs Market: Gary's total compensation ($USD11.02M) is above average for companies of similar size in the US market ($USD6.39M).

Compensation vs Earnings: Gary's compensation has been consistent with company performance over the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Patrick Nettles
Executive Chairman of the Board18.8yrsUS$373.79k0.22% $14.7m
Gary Smith
CEO, President & Director18.8yrsUS$11.02m0.13% $8.7m
James Moylan
Senior VP of Finance & CFO12.2yrsUS$3.32m0.16% $10.8m
David Rothenstein
Senior VP11.3yrsUS$2.72m0.18% $12.3m
Jason Phipps
Senior Vice President of Global Sales & Marketing3yrsUS$2.79m0.0095% $645.1k
Scott McFeely
Senior Vice President of Global Products & Services4.3yrsUS$2.74m0.025% $1.7m
Stephen Alexander
Senior VP14.8yrsUS$1.81m0.065% $4.4m
Gregg Lampf
Vice President of Investor Relations9.4yrsno datano data
Jane Hobbs
Chief HR Officer & Senior VP2.9yrsno datano data
Matt Vesperman
Managing Director of Australia & New Zealand3.8yrsno datano data

9.4yrs

Average Tenure

59yo

Average Age

Experienced Management: CIEN's management team is seasoned and experienced (9.4 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Patrick Nettles
Executive Chairman of the Board18.8yrsUS$373.79k0.22% $14.7m
Gary Smith
CEO, President & Director18.8yrsUS$11.02m0.13% $8.7m
Stephen Alexander
Senior VP14.8yrsUS$1.81m0.065% $4.4m
Bruce Claflin
Independent Director13.5yrsUS$280.88k0.039% $2.6m
Judith O'Brien
Independent Director19.6yrsUS$286.88kno data
Lawton Fitt
Independent Director19.3yrsUS$290.88k0.0026% $172.3k
Kenneth Minihan
Member of Government Advisory Board14.7yrsno datano data
Patrick Gallagher
Lead Independent Director2.1yrsUS$310.88k0.032% $2.2m
David Peed
Member of Government Advisory Board3.9yrsno datano data
John Breen
Member of Partner Advisory Council10.8yrsno datano data

14.8yrs

Average Tenure

67yo

Average Age

Experienced Board: CIEN's board of directors are seasoned and experienced ( 14.8 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: CIEN insiders have only sold shares in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 8.3%.


Top Shareholders

Company Information

Ciena Corporation's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Ciena Corporation
  • Ticker: CIEN
  • Exchange: NYSE
  • Founded: 1992
  • Industry: Communications Equipment
  • Sector: Tech
  • Market Cap: US$6.755b
  • Shares outstanding: 153.91m
  • Website: https://www.ciena.com

Number of Employees


Location

  • Ciena Corporation
  • 7035 Ridge Road
  • Hanover
  • Maryland
  • 21076
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
CIENNYSE (New York Stock Exchange)YesCommon StockUSUSDFeb 1997
CIE1DB (Deutsche Boerse AG)YesCommon StockDEEURFeb 1997
CIEXTRA (XETRA Trading Platform)YesCommon StockDEEURFeb 1997
CIE-UETLX (Eurotlx)YesCommon StockITEURFeb 1997

Biography

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. The company’s Networking Platforms segment offers hardware networking solutions optimized for the convergence of coherent optical transport, optical transport network switching, and packet switching. Its products include 6500 Packet-Optical Platform, 5430 Reconfigurable Switching System, Waveserver stackable interconnect system, CoreDirector Multiservice Optical Switches, and OTN configuration for the 5410 Reconfigurable Switching System, as well as Z-Series Packet-Optical Platform; 3000 family of service delivery switches and service aggregation switches, and the 5000 family of service aggregation switches, as well as 8700 Packetwave Platform and the Ethernet packet configuration for the 5410 Service Aggregation Switch; and 6500 Packet Transport System. This segment also sells operating system software and enhanced software features embedded in each of its products. The company’s Blue Planet Automation Software and Services segment provides multi-domain service orchestration, inventory, route optimization and analysis, network function virtualization orchestration, analytics, and related services. Its Platform Software and Service segment offers OneControl unified management system and platform software services, as well as manage, control, and plan software. The company’s Global Services segment provides consulting and network design, installation and deployment, maintenance support, and training services. The company sells its products through direct and indirect sales channels to network operators. Ciena Corporation was founded in 1992 and is headquartered in Hanover, Maryland. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/02/23 00:27
End of Day Share Price2020/02/21 00:00
Earnings2019/10/31
Annual Earnings2019/10/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.