In a report released today, Meta Marshall from Morgan Stanley maintained a Hold rating on Ciena (CIEN – Research Report), with a price target of $80.00.
Meta Marshall has given her Hold rating due to a combination of factors influencing Ciena’s current market position. The company is entering its fiscal first quarter with favorable conditions, including strong service provider and cloud data points, alongside a relatively easy year-over-year comparison. These factors suggest a potential for Ciena to exceed expectations in the upcoming quarter. However, there is caution regarding the potential for a significant full-year guidance raise, as the company may remain within an 8-11% growth range.
Despite a recent selloff in AI-related stocks, Ciena’s valuation appears more reasonable, particularly with a projected 20x FY26 earnings per share, aligning with its double-digit growth potential. While there is optimism for the short-term setup, driven by positive reports from other service providers and cloud companies, the long-term outlook remains uncertain. The company’s telecom business has shown improvement, but the overall growth is expected to be led by the cloud sector. Consequently, while there is a positive bias towards the upcoming earnings report, the Hold rating reflects a balanced view of potential risks and opportunities.
In another report released on March 7, Rosenblatt Securities also maintained a Hold rating on the stock with a $79.00 price target.
Based on the recent corporate insider activity of 101 insiders, corporate insider sentiment is negative on the stock. This means that over the past quarter there has been an increase of insiders selling their shares of CIEN in relation to earlier this year.