CIEN : NYSE : Technology
$24.35 -0.07 | -0.29%
Today's Range: 24.26 - 24.63
Avg. Daily Volume: 3023000.0
05/23/17 - 3:59 PM ET

Financial Analysis


CIENA CORP's gross profit margin for the first quarter of its fiscal year 2017 is essentially unchanged when compared to the same period a year ago. Sales and net income have grown, and although the growth in revenues has outpaced the average competitor within the industry, the net income growth has not. CIENA CORP has strong liquidity. Currently, the Quick Ratio is 1.85 which shows the ability to cover short-term cash needs. The company's liquidity has decreased from the same period last year, indicating deteriorating cash flow.

At the same time, stockholders' equity ("net worth") has greatly increased by 27.40% from the same quarter last year. The key liquidity measurements indicate that the company is unlikely to face financial difficulties in the near future.

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Income Statement Q1 FY17 Q1 FY16
Net Sales ($mil)621.5573.12
EBITDA ($mil)54.6645.33
EBIT ($mil)21.512.92
Net Income ($mil)3.86-11.55


Balance Sheet Q1 FY17 Q1 FY16
Cash & Equiv. ($mil)943.91870.33
Total Assets ($mil)2860.092589.32
Total Debt ($mil)1236.31278.24
Equity ($mil)798.89627.03


Profitability Q1 FY17 Q1 FY16
Gross Profit Margin47.0546.59
EBITDA Margin8.797.9
Operating Margin3.462.25
Sales Turnover0.930.96
Return on Assets3.070.72
Return on Equity11.013.01
Debt Q1 FY17 Q1 FY16
Current Ratio2.373.15
Debt/Capital0.610.67
Interest Expense15.212.71
Interest Coverage1.411.02


Share Data Q1 FY17 Q1 FY16
Shares outstanding (mil)141.26137.44
Div / share0.00.0
EPS0.03-0.08
Book value / share5.664.56
Institutional Own % n/a n/a
Avg Daily Volume3024736.02656889.0

Valuation


HOLD. CIENA CORP's P/E ratio indicates a significant premium compared to an average of 22.98 for the Communications Equipment industry and a significant premium compared to the S&P 500 average of 25.02. For additional comparison, its price-to-book ratio of 4.01 indicates a premium versus the S&P 500 average of 3.00 and a premium versus the industry average of 3.14. The price-to-sales ratio is well below both the S&P 500 average and the industry average, indicating a discount. After reviewing these and other key valuation criteria, CIENA CORP proves to trade at a premium to investment alternatives within the industry.


Price/Earnings
1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
CIEN 37.18 Peers 22.98   CIEN 12.77 Peers 13.72

Premium. A higher P/E ratio than its peers can signify a more expensive stock or higher growth expectations.

CIEN is trading at a significant premium to its peers.

 

Average. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures.

CIEN is trading at a valuation on par to its peers.

 
Price/Projected
Earnings
1 2 3 4 5
premium   discount
  Price to
Earnings/Growth
1 2 3 4 5
premium   discount
CIEN 11.31 Peers 19.77   CIEN 0.16 Peers 0.92

Discount. A lower price-to-projected earnings ratio than its peers can signify a less expensive stock or lower future growth expectations.

CIEN is trading at a significant discount to its peers.

 

Discount. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples.

CIEN trades at a significant discount to its peers.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
CIEN 4.01 Peers 3.14   CIEN 238.88 Peers 5.86

Premium. A higher price-to-book ratio makes a stock less attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet.

CIEN is trading at a significant premium to its peers.

 

Higher. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios.

CIEN is expected to have an earnings growth rate that significantly exceeds its peers.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
CIEN 1.21 Peers 2.92   CIEN 6.39 Peers 13.77

Discount. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales.

CIEN is trading at a significant discount to its industry on this measurement.

 

Lower. A sales growth rate that trails the industry implies that a company is losing market share.

CIEN significantly trails its peers on the basis of sales growth

 

 

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