Why Ciena and ADTRAN Shares Jumped


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 Ciena (NAS: CIEN) and ADTRAN (NAS: ADTN) have jumped today by as much as 13% and 10%, respectively, after AT&T (NYS: T) said it was boosting network spending.

So what: Ma Bell is now planning on spending $14 billion over the next three years to significantly boost both its wireless and wireline broadband networks in what it's calling Project Velocity IP. That's good news to providers of networking gear like Ciena and ADTRAN, especially as Verizon (NYS: VZ) predicts its capital expenditures this year will decline from last year.

Now what: AT&T wants to expand its 4G LTE coverage to 300 million people in the U.S. by the end of 2014, which is more than the previous plan to cover 250 million by 2013. If the move adds pressure for other carriers to ramp up spending on their own networks, that could be even more good news for Ciena and ADTRAN as recipients of those spending dollars.

Interested in more info on Ciena or ADTRAN? Add them to your watchlist by clicking here and here.

The article Why Ciena and ADTRAN Shares Jumped originally appeared on Fool.com.

Fool contributor Evan Niu, CFA owns shares of Verizon Communications. The Motley Fool has no positions in the stocks mentioned above. Motley Fool newsletter services recommend AT&T. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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