Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.
What: Shares of long-distance networking specialist Ciena (NAS: CIEN) shined today, climbing as much as 12% on above-average trading volume.
So what: Ciena itself doesn't have a lot of news to share today, but rival Cisco Systems (NAS: CSCO) jumped 18% on an estimate-beating fourth quarter. Of particular relevance to Ciena was Cisco's 16% year-over-year jump in telecom orders.
Now what: Are the telecom giants of the world finally getting back to the promised network builds in support of data-heavy 4G offerings? That's how investors are reading Cisco's tea leaves anyway, boosting share prices of telecom-focused network vendors Ciena, JDS Uniphase (NAS: JDSU) , and Alcatel-Lucent (NYS: ALU) nearly as generously as Cisco's own. However, the last three months have been brutal for every type of networking stock, and Ciena shares are down more than 50% over that span despite this jump. All things considered, I see tremendous deals on Ciena and Alcatel-Lucent at these prices but a big value trap hidden behind Cisco's discounts.
Interested in more info on Ciena? Add it to your watchlist.
At the time thisarticle was published Fool contributorAnders Bylundholds no position in any of the companies discussed here. The Fool owns shares of and has created a bull call spread position on Cisco Systems.Motley Fool newsletter serviceshave recommended buying shares of Cisco Systems. Try any of our Foolish newsletter servicesfree for 30 days. We Fools may not all hold the same opinions, but we all believe thatconsidering a diverse range of insightsmakes us better investors. The Motley Fool isinvestors writing for investors.
Copyright © 1995 - 2011 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.