CIEN : NYSE : Technology
$20.32 up 0.24 | 1.20%
Today's Range: 19.97 - 20.47
Avg. Daily Volume: 3,221,100
07/25/16 - 4:00 PM ET

Financial Analysis


CIENA CORP's gross profit margin for the second quarter of its fiscal year 2016 is essentially unchanged when compared to the same period a year ago. Even though sales increased, the net income has decreased, representing a decrease to the bottom line. CIENA CORP is extremely liquid. Currently, the Quick Ratio is 2.70 which clearly shows the ability to cover any short-term cash needs. CIEN managed to increase the liquidity from the same period a year ago, despite already having very strong liquidity to begin with. This would indicate improved cash flow.

At the same time, stockholders' equity ("net worth") has greatly increased by 382.47% from the same quarter last year. Overall, the key liquidity measurements indicate that the company is very unlikely to face financial difficulties in the near future.

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Income Statement Q2 FY16 Q2 FY15
Net Sales ($mil)640.72621.6
EBITDA ($mil)65.1467.84
EBIT ($mil)32.2543.42
Net Income ($mil)14.020.65


Balance Sheet Q2 FY16 Q2 FY15
Cash & Equiv. ($mil)1117.21731.43
Total Assets ($mil)2981.582091.56
Total Debt ($mil)1538.591296.23
Equity ($mil)669.01138.66


Profitability Q2 FY16 Q2 FY15
Gross Profit Margin46.8945.98
EBITDA Margin10.1610.91
Operating Margin5.036.98
Sales Turnover0.841.12
Return on Assets0.41-0.6
Return on Equity1.83-9.13
Debt Q2 FY16 Q2 FY15
Current Ratio3.32.92
Debt/Capital0.70.9
Interest Expense12.6112.95
Interest Coverage2.563.35


Share Data Q2 FY16 Q2 FY15
Shares outstanding (mil)138.01117.7
Div / share0.00.0
EPS0.10.17
Book value / share4.851.18
Institutional Own % n/a n/a
Avg Daily Volume3215728.03571957.0

Valuation


HOLD. CIENA CORP's P/E ratio indicates a significant premium compared to an average of 27.55 for the Communications Equipment industry and a significant premium compared to the S&P 500 average of 25.05. For additional comparison, its price-to-book ratio of 4.11 indicates a premium versus the S&P 500 average of 2.81 and a premium versus the industry average of 3.09. 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 181.27 Peers 27.55   CIEN 10.11 Peers 12.38

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.

 

Discount. 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 discount 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 11.73 Peers 18.33   CIEN 0.14 Peers 0.62

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 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 4.11 Peers 3.09   CIEN 178.57 Peers 51.41

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 1.10 Peers 3.14   CIEN 6.96 Peers 10.39

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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