Ciena (CIEN) this morning reported numbers for the quarter ended Oct. 31 that came in a bit below expectations on the earnings front and also tightened/slightly lowered guidance for the current quarter (the fiscal first quarter ending January 2017), as I anticipated in my preview from yesterday.
The provider of communications network equipment and services reported earnings for the October quarter of $0.44 per share on revenues of $716.2 million. The Street was expecting earnings of $0.46 per share on revenues of $716.9 million.
For the current quarter ending in January, Ciena is guiding revenues to a range of $615 million to $645 million, or $630 million at the midpoint, versus the current Street consensus of $635 million in revenues. The company also is guiding gross margins in the mid-40s range (in line with estimates) and operating expense in the range of $220 million to $225 million for the current quarter.
The company finished the October quarter with $1.1 billion in cash and investments and generated $137 million in operational cash flow in the quarter.
Currently valued at around 13x estimated earnings of $1.71 per share for the year ending January 2018, Ciena shares are cheap if compared on a market multiple to earnings basis.
However, there is nothing in the results to get me too excited or too despondent.
Though the shares initially were down in pre-market trading, they rose and opened the day up about 12%.
Going into the earnings this morning, shares were priced for a move of $1.90 per share in either direction.
What the sell-siders say this morning will be interesting to read given the fact that there were 15 buy ratings on the company going into the earnings report.
