Ciena Corp. (NYSE:CIEN) has made an impressive run this year from an open of $16.04 to a current price of $23.36. The U.S. based global telecommunications firm is enjoying the 45%+ year on the back of 3 consecutive quarters that have impressed analysts and investors alike.
Ciena is expected to report FQ4' 2013 earnings on Thursday, December 11th. The information below is derived from data submitted to the Estimize platform by a set of Buy Side and Independent analyst contributors.
The current Wall Street consensus expectation is for Ciena to report 25c EPS and $569.30M revenue, while the current Estimize consensus from Buy Side and Independent contributing analysts is 26c EPS and $571.16 revenue. The Estimize consensus is more accurate than Wall Street up to 69.5% of the time because it represents unbiased market expectations. Over the past 3 quarters, the Estimize consensus has been more accurate on EPS 3 times and more accurate on revenue twice. By tapping into a wider distribution of over 3,300 contributors including buy side and independent analysts, industry experts, students, and non professionals, Estimize is better able to capture the true market outlook. The magnitude of the difference between the Wall Street and Estimize consensus numbers often identifies opportunities to take advantage of expectations that may not have been priced into the market. In this case, we're seeing a smaller differential between the Estimize and Wall Street numbers compared to previous quarters.
Over the past four months the Wall Street consensus trend for EPS has increased from 22c to 25c while the revenue expectations have improved from $550.71M to $569.30M. The Estimize EPS and revenue consensuses have both similarly increased this quarter, with EPS going from 23c to 26c and the revenue forecast surging late from $567.93M to $571.16M.
Over the previous 3 quarters, CIEN has beaten the Wall Street consensus for EPS and revenue all 3 times. Over the same time period, the company has beaten the Estimize EPS consensus 2 times and has been accurately forecasted once. In terms of revenue, CIEN beat the Estimize consensus twice and came up slightly short once.
The distribution of estimates published by analysts on Estimize range from 23c to 29c EPS and $564.10M to $579.00M in revenues. We're seeing a larger distribution of estimates for CIEN this quarter, compared to the past 2 quarters. The size of the distribution of estimates relative to previous quarters often signals whether or not the market is confident that it has priced in the expected earnings already. A wider distribution signals the potential for greater volatility post earnings, a narrower vice versa.
The analyst with the highest estimate confidence rating this quarter is UdallTechStrat who projects 23c EPS and $565.89M in revenue. Estimize confidence ratings are calculated through algorithms developed by our deep quantitative research which looks at correlations between analyst track records and tendencies as they relate to future accuracy. UdallTechStrat, who is ranked 16 overall among 3,328 contributing analysts, is separating himself from the pack by making a more bearish call compared to both Wall Street and the Estimize community.
In contradiction to the analyst with the top confidence rating, the Estimize community is expecting another better than Wall Street report from Ciena Corp. A 4th consecutive beat against the Wall Street earnings expectations could have Ciena continuing to fly high into 2014.