Ricard

Big Debt and Big Returns Could Be Spurring This Rally

I don't think CIEN deserves to be lumped with this crowd. I sold JDSU to add to my CIEN stake due to better financials, both income statement and balance sheet-wise. Fact is, it was posting a healthy profit before July of last year for a good six straight quarters, and given those earnings figures, is a downright steal at these prices. This translates to a full recovery from the dot-com bust IMHO. It has enough CASH on hand to retire its debt if it so chooses, but otherwise has years before its next maturity in which to weather this storm. It's holding quite well compared to competitors such as Nortel or ALU - the last earnings statement corroborates this viewpoint.

I realize that it's in your 2nd best decile of balance sheet performers, but I don't think it deserves to be lumped in a crowd to include BofA, Citi, and MBIA.

Mean reversion for this stock should be around $2/share pre-reverse split, or around $15. That would take it to the low that it reached in the dot-com bust, when it was hemmoraging capital. Tertiary industries such as Ciena's have been unduly hit by the outflow of capital in the past year.