Ciena Corporation
CIEN
recently announced that AccessOn Networks, a leading provider of full fiber rural broadband connectivity in North Carolina, will utilize its networking solutions to expand network capacity across the region. The deal will also enable AccessOn to better manage bandwidth-intensive applications, drive innovation and expand services in remote areas.
Per the deal, AccessOn will leverage Ciena’s Routing and Switching portfolio to offer high-speed 100GbE links at key network locations. Powered by WaveLogic coherent optics, the 6500 Packet Optical platform offers a robust infrastructure that is highly scalable and cost-effective for a rural set up. This will facilitate the carrier to better address the evolving customer demand across a single, converged packet-based transport network. This, in turn, will enable AccessOn to enhance real-time visibility and proactively take steps to address any potential issue while extending its rural footprint.
Notably, about 5% of the households in North Carolina do not have Internet connection, while about 61% of those having broadband connectivity lack the FCC-recommended minimum standard download and upload speed of 25 Mbps and 3 Mbps, respectively. In addition to bridging the digital divide, the deployment of Ciena’s solutions will accommodate the increasing demand for data for improved end-user experience.
The deal would increase scope for Ciena’s customer engagement, as well as boost sales, leading to a recurring revenue stream. The company’s top line is expected to benefit from rising demand for packet-optical transport and switching products, integrated network and service management software. Ciena has been diversifying its footprint in data-center connectivity. This has enhanced its reach into a broader end-to-end optical and data-equipment market.
The company is increasingly investing in the data and optical fiber market in order to cash in on the tremendous growth opportunity presented by rising bandwidth demand from network service providers. Moreover, network upgrades by telecom carriers to meet increasing demand bode well for the company’s long-term growth prospects. Currently, the company is one of the leading suppliers of 40G and 100G optical transport technology.
In addition, Ciena is making efforts to expand its Web Scale IT Architecture in the enterprise market by launching products like chipsets, metro architecture and mobile backhaul solutions. Fiber Deep technology represents a big opportunity for the company, driven by the strong adoption of its products among all major cable operators in the global market. We believe Ciena’s strong product portfolio will boost its top line in the long run.
The company remains confident about its business model and ability to achieve the three-year financial targets on the back of its diversification, global scale and innovation leadership. The company is augmenting its Packet Networking portfolio with new Adaptive IP capabilities, coherent optics and purpose-built hardware platforms to enable service providers to capitalize on 5G.
Ciena currently has a Zacks Rank #3 (Hold). Some better-ranked stocks in the broader industry are
United States Cellular Corporation
USM
,
Cogent Communications Holdings, Inc.
CCOI
and
ATN International, Inc.
ATNI
, each carrying a Zacks Rank #2 (Buy). You can see
the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here
.
U.S. Cellular delivered a trailing four-quarter earnings surprise of 123.9%, on average.
Cogent delivered a trailing four-quarter earnings surprise of 29%, on average.
ATN International delivered an earnings surprise of 424.2%, on average, in the trailing four quarters.
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