BofA Downgrades Ciena (CIEN) to Neutral Citing Peaking Backlog and High Valuation After 200% Surge

Ciena Corporation (NYSE:CIEN) is 1 of the best US stocks to bargain and clasp successful 2026. On January 20, Bank of America expert Tal Liani downgraded Ciena to Neutral from Buy with an unchanged terms people of $260. Although determination is imaginable for further gross growth, the steadfast is prioritizing caution owed to downside risks specified arsenic peaking backlog levels, inflated expectations, and a steep valuation pursuing Ciena’s 200% banal surge implicit the past year.

In Q4 2025, Ciena Corporation (NYSE:CIEN) achieved $1.35 cardinal successful revenue, which was a 20% year-over-year increase, portion quarterly EPS surged 69% to $0.91. This beardown decorativeness pushed full-year gross to a grounds $4.77 billion, with a full yearly EPS of $2.64, a 45% summation from 2024. The institution besides secured a grounds $7.8 cardinal successful yearly orders, resulting successful a monolithic $5 cardinal backlog, of which $3.8 cardinal is composed of hardware and software.

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The company’s maturation was fueled by divers segments, peculiarly those supporting AI infrastructure and unreality scaling. The Routing and Switching concern grew by 49% year-over-year, portion Global Services accrued by 25%. The Interconnect portfolio generated implicit $168 cardinal successful gross for fiscal 2025, and the Blue Planet part contributed $115 million. Additionally, Ciena expanded its optical marketplace stock by 2 points year-to-date, driven by accelerating request from unreality providers.

Ciena Corporation (NYSE:CIEN) is simply a web exertion institution that provides hardware, software, and services for assorted web operators successful the Americas, Europe, the Middle East, Africa, the Asia Pacific, Japan, and India.

While we admit the imaginable of CIEN arsenic an investment, we judge definite AI stocks connection greater upside imaginable and transportation little downside risk. If you’re looking for an highly undervalued AI banal that besides stands to payment importantly from Trump-era tariffs and the onshoring trend, spot our escaped study connected the best short-term AI stock.

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Disclosure: None. This nonfiction is primitively published at Insider Monkey.