Evercore ISI maintains CIENA stock with $68 target

On Wednesday, Evercore ISI sustained its ’In Line’ rating and a $68.00 price target for CIENA (NYSE:CIEN) shares, which currently trades at $61.54. The stock has seen analyst targets ranging from $65 to $100, with 6 analysts recently revising earnings estimates upward according to InvestingPro data. Following a meeting with CIENA’s management team, Evercore ISI’s analysts shared key insights into the company’s strategic direction and technological advancements. CIENA is recognized for its pioneering role in developing coherent lite pluggables, which are anticipated to generate revenue in the second half of 2026 and could address a total addressable market (TAM) exceeding $1.7 billion by 2028.

CIENA is shifting towards a components-based business model to cater to new use cases, including coherent lite and PAM4 products among others. With a solid financial foundation including a current ratio of 3.65 and moderate debt levels, the company appears well-positioned for this transition. The company’s core technology portfolio extends beyond digital signal processors (DSPs), with multiple opportunities identified to monetize their technological edge, such as analog-to-digital converters, serializer/deserializer circuits (SerDes), and electro-optical components.

The company’s current cloud business is exclusively focused on wide area network (WAN) applications, suggesting that potential fluctuations in data center capital expenditures are unlikely to affect CIENA’s performance. The company also anticipates continued investment in the WAN sector, regardless of data center spending outcomes.

CIENA’s management expressed optimism regarding the telecom industry, especially after moving past an inventory correction phase. With revenue expected to grow 11% in fiscal year 2025 and a healthy gross profit margin of 42.58%, the company is well-positioned to capitalize on its technology leadership by venturing into new markets, particularly those related to artificial intelligence (AI). For deeper insights into CIENA’s growth potential and comprehensive analysis, investors can access the detailed Pro Research Report available on InvestingPro, which covers over 1,400 top US stocks. Evercore ISI reaffirms its ’In Line’ rating and maintains a $68 price target, signaling confidence in CIENA’s sustained market position and growth potential.

In other recent news, Ciena Corporation reported first-quarter revenue of $1.07 billion, surpassing analysts’ expectations, with earnings per share reaching $0.64, exceeding projections. The company’s gross margin of 44.7% was notably higher than anticipated, although UBS analysts noted this included non-recurring items. Despite the strong earnings, UBS adjusted its price target for Ciena to $73 from $85, maintaining a Neutral rating. In contrast, Stifel analysts maintained a Buy rating with a $95 price target, citing strong order momentum and Ciena’s strategic positioning in optical networking. Northland also upgraded Ciena’s stock from Market Perform to Outperform, setting a new price target of $75, highlighting a 14% increase in Service Provider revenues. Additionally, Ciena and Lumen Technologies successfully completed a network trial, achieving a 1.2 terabit wavelength over 1,800 miles, showcasing Ciena’s advanced WaveLogic 6 Extreme technology. The company also held its annual meeting where shareholders approved board nominees and ratified PricewaterhouseCoopers LLP as the independent auditor for fiscal year 2025. These developments underscore Ciena’s ongoing momentum in both financial performance and technological innovation.

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