Understanding the Decline in Ciena (CIEN) Stock: A Detailed Analysis
Why investors are selling Ciena stock
Tech investors are not huge fans of falling revenues. Shares of optical networking equipment maker Ciena Communications (NYSE: CIEN) were down by 13.5% as of 11:15 a.m. ET Thursday, despite the company delivering expectations-beating results on both sales and earnings in the quarterly report it released before the opening bell.
Decline in Earnings
CEO Gary Smith touted strong profitability, but GAAP earnings in fiscal Q1 were significantly lower, mainly due to interest rate fluctuations.
Sales Projections
Ciena's sales forecast for 2024 is below analyst expectations, leading to concerns about its revenue growth potential.
Is Ciena stock a sell?
Management's guidance suggests lower sales and flat earnings, despite margin improvements, making investors skeptical about the stock's valuation.
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