Ciena Corporation provides equipment, software, and services that support the transport, switching, aggregation, service delivery, and management of voice, video, and data traffic on communications networks worldwide. The company was founded in 1992 and is based in Hanover, Maryland.
CIEN Price Forecast Based on DCF Valuation
DCF Fair Value Target:
Below please find a table outlining a discounted cash flow forecast for CIEN, in which we model out valuation assuming a variety of terminal growth rates. To summarize, we found that Ciena Corp ranked in the 68th percentile in terms of potential gain offered. Specifically, our DCF analysis implies the stock is trading below its fair value by an estimated 173.33%. In terms of the factors that were most noteworthy in this DCF analysis for CIEN, they are:
In the past 5.48 years, Ciena Corp has a compound free cash flow growth rate of 0.5%; that's higher than 76.96% of free cash flow generating stocks in the Technology sector.
The business' balance sheet suggests that 8% of the company's capital is sourced from debt; this is greater than just 18.72% of the free cash flow producing stocks we're observing.
CIEN's estimated cost of debt, based largely on its market capitalization and its interest coverage ratio, is 2%; for context, that number is higher than 42.31% of tickers in our DCF set.
Terminal Growth Rate in Free Cash Flow
Return Relative to Current Share Price
For other companies in the Technology that have a similar discounted cashflow valuation profile (and ensuing price forecasts) as CIEN, try UCTT, PRFT, HEAR, TAIT, and GDDY.
Ciena breaks out of a consolidation with a buy point a little above 57. Tried to break out on July 6, faltered, found support at 50-day and moved higher. Earnings growth/estimates strong. Revenue gains small. Growing Huawei bans/curbs good news for Ciena.