Ciena stock price target raised to $100 from $78 at Rosenblatt

Investing.com - Rosenblatt raised its price target on Ciena (NYSE:CIEN) to $100.00 from $78.00 on Friday, while maintaining a Neutral rating on the telecommunications equipment provider. The stock is currently trading near its 52-week high of $101.44, having delivered an impressive 72.5% return over the past year.

The price target increase represents a 28% boost from the previous target, with Rosenblatt basing the new valuation on 30 times consensus fiscal year 2026 earnings per share. According to InvestingPro analysis, the stock currently trades at a P/E ratio of 134.65, suggesting a rich valuation relative to earnings.

Rosenblatt noted that demand for Data Center Interconnect (DCI) "looks great," but indicated that margins remain "just okay" due to a mix shift toward chassis and pluggable components.

The firm expressed caution about Ciena’s current valuation, stating that expectations are high and the stock trades at "a rich multiple."

Rosenblatt indicated it would consider a more positive stance if Ciena demonstrates leadership in new product categories, such as 400G-per-lane SerDes and DSP for 3.2+ terabit transceivers, or shows a sustainable path to gross margins higher than the low 40% range.

In other recent news, Ciena Corporation has reported mixed financial results for its fiscal second quarter of 2025, with revenue increasing by 3% while non-GAAP earnings per share fell short of expectations by $0.10. The company experienced significant growth in its cloud segment, with an 88% year-over-year increase, but faced challenges due to lower-than-expected gross margins on new products and increased tariff costs impacting gross profit by approximately $10 million per quarter. UBS analysts have responded by raising their price target for Ciena stock to $78, citing an 85% year-over-year growth in direct cloud-related revenue, although they noted that the company’s gross margin of 41% was below their estimate.

Morgan Stanley has downgraded Ciena from Equalweight to Underweight, reducing its price target to $70, due to concerns over disappointing margin performance despite opportunities in the optical AI market. Meanwhile, Needham analysts maintained a Buy rating with a $90 price target, acknowledging the mixed results but highlighting strong bookings in the cloud segment. In leadership news, Ciena has announced the appointment of Marc D. Graff as the new Chief Financial Officer, effective August 1, 2025, succeeding James E. Moylan, Jr., who will retire later that month. Graff brings nearly 30 years of global finance experience, having previously served as CFO at Altera Corporation.

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