BofA Downgrades Ciena (CIEN) to Neutral, Analyzes 2026 Networking Equipment Outlook
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Jan 20 2026
0mins
Source: seekingalpha
- Rating Downgrade: BofA downgraded Ciena's stock from Buy to Neutral, focusing on downside risks related to peaking backlog levels and high expectations, which could negatively impact stock performance despite potential revenue growth.
- Market Outlook: Analysts highlighted Gartner's forecast that AI networking spending will grow at a 28% CAGR to $56.6 billion by 2029, although hyperscaler Capex growth is expected to decelerate from 68% in 2025 to 39% in 2026, indicating a challenging near-term environment.
- Deployment Challenges: Companies face multiple hurdles in adopting agentic AI, including inadequate data readiness, limited operational readiness, and insufficient cybersecurity measures, which may slow down network investment progress.
- Competitive Analysis: While Ciena faces risks from high valuations and slowing order trends, analysts believe Cisco offers a solid risk/reward profile, while Arista is expected to maintain strong near-term revenue growth despite some flagged risks.
Analyst Views on CIEN
Wall Street analysts forecast CIEN stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for CIEN is 253.50 USD with a low forecast of 190.00 USD and a high forecast of 305.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
14 Analyst Rating
9 Buy
5 Hold
0 Sell
Moderate Buy
Current: 232.230
Low
190.00
Averages
253.50
High
305.00
Current: 232.230
Low
190.00
Averages
253.50
High
305.00
About CIEN
Ciena Corporation is a network system, software, and services company which provides hardware, software, and services to a range of network operators and enables enhanced network capacity, service delivery, and automation. Its segments include Networking Platforms, Platform Software and Services, Blue Planet Automation Software and Services, and Global Services. Networking Platforms segment consists of Optical Networking and Routing and Switching portfolios. Platform Software and Services which provides domain control management, analytics, data and planning tools and applications to assist customers in managing their networks. Blue Planet Automation Software and Services includes inventory management (BPI), multi-domain service orchestration, multi-cloud orchestration, route optimization and analysis (ROA), and unified assurance and analytics (UAA). Global Services segment offers a suite of value-added services that help its customers to build, operate and improve their networks.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
