Ciena Corporation (NASDAQ: CIEN) announced its fiscal Q1 2022 earnings and revenue results on Monday, March 07, 2022, which matched Wall Street consensus earnings estimates but missed revenue projections.
What to look for: Ciena's first-quarter sales increased almost 10% YoY, and ongoing broad-based demand fuelled exceptionally robust order growth, giving the company more clarity for fiscal 2022. In addition, the firm anticipates that its strategic investments will result in a considerable expansion in supply chain capabilities in 2H 2022, giving it confidence in its ability to meet demand and accomplish the strong revenue growth forecast for the fiscal year.
Earnings: Stockearning’s Estimated EPS was $0.29 per share in Q1 2022. The company reported GAAP net income of $45.8 million with non-GAAP adjusted net income of $72.6 million or $0.47 per share in line with Street estimates. A year ago, the company had a net income of $55.3 million or $0.35 per diluted share with adjusted non-GAAP net income of $81.3 million or $0.52 per dilutes share. Historical EPS Performance for the past 12 quarters shows that the company has topped estimates 25 times (69%), met once (2%), and missed ten times (27%).
Revenue: in the fiscal Q1 2022, the high-speed networking tech developer reported revenue of $844.4 million missing in Wall Street estimates of $846.5 million. In the first quarter of fiscal 2021, the company had revenue of $757.1 million. The company expects Q2 revenue of $930 million to $970 million, while the consensus estimate is pegged at $960.92 million.
Stock Movement: CIEN shares have gained 6% since the company released its last earnings release. Interestingly, following the earnings release, the company’s shares have been UP 29 times in the past 48 quarters. So, the historical price reaction suggests a 60% probability of the share price going UP following the earnings release. According to the Stockearning algorithm, the predicted volatility on the first day is +/-9%, while the predicted volatility on the seventh day is +/-10%.
What analysts are saying: Loop Capital analyst Fahad NAjam raised his price target in the stock from $87 to $92 and maintained a Buy rating on the stock. Despite the company's lower sales projection, the analyst writes in a research note that its Q1 pre-announcement revealed "much improved" underlying demand patterns and operational model. Najam goes on to say that the revenue drop was attributable to "transitory factors," and that Ciena's speech and data points create a far better image of the demand forecast and far greater visibility, which the investing community overlooks.
Recently Raymond James analyst Simon Leopold raised his price target on the stock from $75 to $80 and maintained a Buy rating in the shares. Leopold told investors in a research note that according to Ciena's channel inspections, the company has addressed customers in an attempt to raise product prices because of a large backlog, albeit potential price increases are unlikely to have a meaningful impact on fiscal 2022.
Related News
Kroger Co (NYSE: KR) Beats Q4 2021 Earnings and Revenue Estimates.
Hibbet Sports Inc. (NASDAQ: HIBB) Earnings Expectations, Fiscal Q4 2022 EPS of $1.22.