For several quarters, investors have parsed remarks by the major optical networking equipment makers for any hint of a bottom. Today, Ciena's
Yes, the floor keeps dropping for his company -- and its competitors. Ciena announced that Q3 revenue plummeted to $50 million from a year-ago $458 million. Down 89%. Yet Ciena finished the quarter with $1.30 billion in cash and short-term investments. That's a huge wallet, but investors are watching the cash burn -- $68 million, sequentially.
Here are the last five quarters' revenues and cash and equivalents for Ciena and two other optical gear makers:
Ciena JDS Uniphase Avanex Revs. Cash Revs. Cash Revs. Cash Q3* $50 mil. $1299 $222 $1450 $ 8 $136 Q2 87 1368 262 1564 10 153 Q1 162 1523 286 1653 8 160 Q4 368 1300 329 1754 7 195 Q3 458 1398 601 1812 18 204 *or company's equivalent quarter
All three are watching revenues tumble and cash decline. Ciena shares closed yesterday at $4.49 a share, 9% above its $4.13 a share in cash and short-term investments net of debt. JDS Uniphase
None of these companies is anywhere near a value stock yet -- though if you really understand the industry, you may know something others don't. Please share it on the Ciena discussion board. But the market is assigning odds that these companies may fail, and a little studying might send you in the direction of some intriguing possibilities.