Ciena (CIEN) Upgraded to Buy by Rosenblatt on AI Data Center Opportunity

Ciena Corporation (NYSE:CIEN) is one of the Buzzing AI Stocks on Wall Street. On September 26, Rosenblatt upgrades Ciena to “Buy” from Neutral stating that the data networking company is “exceptionally good.” It holds a price target of $175, up from $127.50.

“We are upgrading CIEN to Buy on the Scale Across opportunity to network multiple AI Data Centers into clusters.”

The firm stated that CIEN has an opportunity to network multiple artificial intelligence data centers into clusters. It has won a similar deal with a hyperscaler with an estimated $200M revenue opportunity and is just getting started.

The firm also pointed to potential upside from the company’s expansion into data center infrastructure and components.

“We are upgrading CIEN to Buy on the Scale Across opportunity to network multiple AI Data Centers into clusters. So far, Ciena has won one such deal with a Hyper Scaler to connect two 100,000 GPU Data Centers 100km apart using WaveLogic 6 Nano 800G ZR pluggables. This customer is installing 20 petabytes of capacity, and is driving Ciena’s development of multi-rail amplifiers that dramatically reduce the space (-98%) and power (-30%) of amplifier huts when hundreds of fiber pairs are simultaneously lit. We estimate the revenues for this deal to be ~$200mn including 800G ZR and ZR+ pluggables and common equipment like amplifiers. We believe the scale across opportunity is just getting started, and Ciena is likely to win many more deals to interconnect Data Centers into clusters using pluggables or embedded DWDM depending on distance and performance requirements.”

Ciena Corporation (NYSE:CIEN) is a leading provider of networking systems and software.

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