Home › Posts tagged ciena stock price

ciena stock price

5G CIENA stock price: a similar ROE method to calculate its intrinsic value

Posted on by

Use a similar ROE model method described here:

Lesson 21

Use the above mentioned calculator,

Cash Taken Out of Business ($): I entered 0 * This is dividends recieved for 1 year.

Current Book Value ($): 14.57 * We need to know this so we can determine the base value that’s changing.

Average Percent Change in Book Value Per Year (%): 6.67 * This will determine the estimate BV at the end of the next 10 years.

Years: 5 * This will most likely be 10 (if you’re comparing a 10 year federal note).

(Discount Rate) 10 Year Federal Note (%): 0.80 * Look up the ten year treasury note by clicking on this text.


Intrinsic Value ($): 19.33607699236469

I got this number as its intrinsic value:

19.33607699236469

The main difference is, I used 9% as discount rate when calculating NPV, while this calculator uses treasury 10-year note rate (0.80%).

Related blog posts:

  1. How to evaluate a stock? The PE multiple method, CIENA as example
  2. ciena stock price: $44.28 is still overvalued based on my valuations
  3. How to evaluate a stock? The ROE valuation method, CIENA as example
  4. how to evaluate a stock

ciena stock price: $44.28 is still overvalued based on my valuations

Posted on by

In my previous blog posts, I laid out a plan how to evaluate stocks using three methods.

In the blog post on how to evaluate a stock, I listed three methods when valuing a stock:

  1. P/E Multiple method
  2. DCF model
  3. Return on equity valuation method

I later dive deep into PE multiple method, and calculate CIEN’s intrinsic value as 39.7379.

If I believe my intrinsic value of CIEN, I will consider buying it below $39.73 per share. That’s close to its price 37.34 on Mar 27, 2020.
Before the broad stock market drop last week, CIEN was traded at 60.07 when market closed on Wednesday 9/2.
Yahoo Finance site says this stock price now is Near Fair Value.
According to GuruFocus,  Ciena Intrinsic Value: Projected FCF : USD 33.40 (As of 9/5/2020).
Per https://trendshare.org/stocks/CIEN/view:
CIEN Price
(Ciena Corporation stock price per share)		 $59.93
[?] CIEN Fair Price
(based on intrinsic value)		 $25.84
[?] CIEN Safety Price (based on a variable margin of safety) $15.50

In my latest blog post, I used ROE model and calculated the intrinsic value of CIEN as $23.74639 .

I later said,

The current share price $44.28 of CIEN as of Friday 9/5/2020 is very much overvalued, in my opinion.
By the way, Ciena price target lowered to $37 from $53 at Barclays. Reiterate Underweight.
Barclay’s analyst Tim Long lowered the firms price target on Ciena to $37 from $53 and keeps an Underweight weight rating on the shares. The company’s fiscal Q3 beat on sales, margin, and earnings; but guidance surprised to the downside.

So based on the above research, I think $23.74639 is CIEN’s intrinsic value, and the safe price to buy is around $15.50 for the margin of safety.

The current share price $44.28 of CIEN as of Friday 9/5/2020 is very much overvalued, in my opinion.

Disclaimer: I am just sharing my information, not suggesting you to buy any stocks or investments. Use the info here at your own risk. Please make your own judgements when making investment decisions.