Comparing Ciena (CIEN) and ViaSat (VSAT)

Ciena (NYSE: CIEN) and ViaSat (NASDAQ:VSAT) are both mid-cap technology companies, but which is the superior investment? We will compare the two companies based on the strength of their profitability, earnings, risk, institutional ownership, valuation, analyst recommendations and dividends.

Earnings and Valuation

This table compares Ciena and ViaSat’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Ciena $2.80 billion 1.10 $1.26 billion $6.92 3.09
ViaSat $1.56 billion 2.79 $23.76 million ($0.20) -373.70

Ciena has higher revenue and earnings than ViaSat. ViaSat is trading at a lower price-to-earnings ratio than Ciena, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Ciena and ViaSat, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Ciena 0 3 18 0 2.86
ViaSat 1 5 6 0 2.42

Ciena presently has a consensus target price of $28.55, suggesting a potential upside of 33.42%. ViaSat has a consensus target price of $73.80, suggesting a potential downside of 1.26%. Given Ciena’s stronger consensus rating and higher probable upside, research analysts plainly believe Ciena is more favorable than ViaSat.

Profitability

This table compares Ciena and ViaSat’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Ciena 45.04% 18.32% 7.02%
ViaSat -0.75% 0.13% 0.08%

Institutional and Insider Ownership

99.4% of ViaSat shares are held by institutional investors. 1.5% of Ciena shares are held by insiders. Comparatively, 7.7% of ViaSat shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Risk and Volatility

Ciena has a beta of 1.67, meaning that its share price is 67% more volatile than the S&P 500. Comparatively, ViaSat has a beta of 0.78, meaning that its share price is 22% less volatile than the S&P 500.

Summary

Ciena beats ViaSat on 11 of the 14 factors compared between the two stocks.

About Ciena

Ciena Corporation is a network strategy and technology company, which provides solutions that enable a range of network operators to adopt communication architectures and deliver an array of services, relied upon by enterprise and consumer end users. It provides equipment, software and services that support the transport, switching, aggregation, service delivery and management of voice, video and data traffic on communications networks. It segments include Networking Platforms; Software and Software-Related Services, and Global Services. The Networking Platforms segment consists of Converged Packet Optical, Packet Networking and Optical Transport product portfolios. The software business is engaged in the development and licensing of element and network management software and software-related services that support its hardware offerings. It offers a suite of consulting and support services that help its customers to design, optimize, deploy and maintain their communications networks.

About ViaSat

ViaSat, Inc. is engaged in broadband technologies and services. The Company operates through three segments: satellite services, commercial networks and government systems. The satellite services segment provides satellite-based broadband services to consumers, enterprises, commercial airlines and mobile broadband customers primarily in the United States. The commercial networks segment develops and produces a range of end-to-end satellite and wireless communication systems, ground networking equipment and space-to-earth connectivity systems. The government systems segment develops and produces network-centric Internet Protocol (IP)-based fixed and mobile secure government communications systems, products, services and solutions, which are designed to enable the collection and dissemination of real-time digital information between command centers, communications nodes and air defense systems.

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