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:
The table below illustrates the output of a discounted cash flow forecast using a variety of scenarios for Ciena Corp. To summarize, we found that Ciena Corp ranked in the 71th percentile in terms of potential gain offered. Specifically, our DCF analysis implies the stock is trading below its fair value by an estimated 204.5%. In terms of the factors that were most noteworthy in this DCF analysis for CIEN, they are:
The compound growth rate in the free cash flow of Ciena Corp over the past 5.48 years is 0.5%; that's higher than 76.78% of free cash flow generating stocks in the Technology sector.
The business' balance sheet reveals debt to be 8% of the company's capital (with equity being the remaining amount). Approximately merely 19.27% of US stocks with free cash flow have a lower reliance on debt in their capital structure.
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 42.8% 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 QRVO, SOFO, ECOM, SQ, and SNX.
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