Critical Review: Ciena (NYSE:CIEN) & Altice USA (NYSE:ATUS)

Altice USA (NYSE:ATUS) and Ciena (NYSE:CIEN) are both computer and technology companies, but which is the better stock? We will contrast the two companies based on the strength of their valuation, risk, dividends, analyst recommendations, earnings, institutional ownership and profitability.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Altice USA	-21.43%	N/A	-0.90%
Ciena	2.59%	8.38%	4.06%

Analyst Ratings

This is a summary of recent ratings for Altice USA and Ciena, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Altice USA	3	1	2	0	1.83
Ciena	0	7	11	2	2.75

Altice USA presently has a consensus price target of $2.55, indicating a potential upside of 42.46%. Ciena has a consensus price target of $237.50, indicating a potential upside of 1.47%. Given Altice USA’s higher possible upside, analysts clearly believe Altice USA is more favorable than Ciena.

Insider and Institutional Ownership

54.8% of Altice USA shares are owned by institutional investors. Comparatively, 92.0% of Ciena shares are owned by institutional investors. 44.6% of Altice USA shares are owned by company insiders. Comparatively, 0.9% of Ciena shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Risk and Volatility

Altice USA has a beta of 1.63, indicating that its share price is 63% more volatile than the S&P 500. Comparatively, Ciena has a beta of 1.13, indicating that its share price is 13% more volatile than the S&P 500.

Valuation & Earnings

This table compares Altice USA and Ciena”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Altice USA	$8.64 billion	0.10	-$102.92 million	($3.96)	-0.45
Ciena	$4.77 billion	6.91	$123.34 million	$0.85	275.37

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

Summary

Ciena beats Altice USA on 11 of the 15 factors compared between the two stocks.

About Altice USA

Altice USA, Inc., together with its subsidiaries, provides broadband communications and video services in the United States, Canada, Puerto Rico, and the Virgin Islands. It offers broadband, video, telephony, and mobile services to residential and business customers. The company's video services include delivery of broadcast stations and cable networks; over the top services; video-on-demand, high-definition channels, digital video recorder, and pay-per-view services; and platforms for video programming through mobile applications. In addition, it provides voice over Internet protocol telephone services; and mobile services, such as data, talk, and text. Further, the company offers Ethernet, data transport, IP-based virtual private networks, Internet access, and telephony services; hosted telephony services, managed Wi-Fi, managed desktop and server backup, and collaboration services comprising audio and web conferencing; fiber-to-the-tower services to wireless carriers; data services consisting of wide area networking and dedicated data access, as well as wireless mesh networks; and enterprise class telephone services that include traditional multi-line phone service. Additionally, it provides hosted private branch exchange, network security, and international calling and toll-free numbers services. Furthermore, the company offers audience-based and multiscreen advertising solutions; data analytics; and news programming services, as well as operates news channels under the News 12 Networks, Cheddar, and i24NEWS names. It also provides broadband communications and video services under the Optimum and Suddenlink brands. Altice USA, Inc. was incorporated in 2015 and is headquartered in Long Island City, New York.

About Ciena

Ciena Corporation provides hardware and software services for delivery of video, data, and voice traffic metro, aggregation, and access communications network worldwide. The company’s Networking Platforms segment offers convergence of coherent optical transport, open optical networking, optical transport network switching, IP routing, and switching services. Its products include 6500 Packet-Optical Platform, Waveserver stackable interconnect system, and the 6500 Reconfigurable line system, and the 5400 family of Packet-Optical platforms, as well as 8100 coherent routing platforms; 3000 family of service delivery switches and the 5000 family of service aggregation switches, as well as 8700 Packetwave Platform and 6500 Packet Transport System. This segment also sells operating system software and enhanced software features embedded in each of its products. The company’s Blue Planet Automation Software and Services segment provides multi-domain service orchestration, inventory, route optimization and analysis, multi-cloud orchestration, and unified assurance and analytics services. Its Platform Software and Service segment offers MCP domain controller solution, and OneControl unified management system, as well as planning tools. The company’s Global Services segment provides maintenance support and training, installation and deployment, and consulting and network design services. Ciena Corporation was incorporated in 1992 and is headquartered in Hanover, Maryland.