William Blair Shares Two Cents on Ciena (CIEN) Following 38th Annual Growth Stock Conference
William Blair's Dmitry Netis believes CIEN is making a comeback thanks to a compelling diversification narrative.
William Blair analyst Dmitry Netis is out with an upbeat research note on Ciena (NYSE:CIEN) on the heels of hosting the 38th Annual Growth Stock Conference. Ciena’s CFO Jim Moylan left Netis increasingly impressed in the tech player’s standing amongst its rivals in the market. This network strategy and technology company is primed to capture more market share, both on the domestic front as well as broad, wagers Netis.
In reaction, the analyst reiterates an Outperform rating on CIEN stock without listing a price target. (To watch Netis’ track record, click here)
“We came away from the presentation incrementally more confident in the company’s competitive positioning, growing market share (both domestically and internationally), and expanding profitability and net income (via operational efficiencies, retirement of dilutive convertible debt, and repurchasing of stock). Management reaffirmed its recently raised revenue growth outlook of 7%-9% for this fiscal year, demonstrating strong confidence in a back-end-loaded second half and reiterated its commitment for an annual growth of 5%-7% over the next three years, on top of amplified revenue momentum in fiscal 2018,” writes Netis.
Additionally, the analyst underscores a turnaround in play: “We believe Ciena has turned the corner and investors should begin to credit the company for its diversification story, as well as expanding market share and profitability. We see an attractive risk/reward profile for Ciena […]”
Bottom line, Netis believes Ciena shares merit a stronger multiple on back of “higher-quality earnings” and growth potential poised to outperform the market over the upcoming three years. The analyst is confident on Ciena’s leadership standing in every segment of the optical arena along with operating margins and a balance sheet growing stronger coupled with robust free cash flows.
TipRanks showcases a strong bullish consensus circling CIEN stock, with all 8 analysts polled in the last 3 months rating a Buy on the network strategy and technology company. With a solid return potential of nearly 29%, the stock’s consensus target price stands at $31.94.