Fabrinet (FN) versus Ciena (CIEN) Head to Head Contrast

Fabrinet (NYSE: FN) and Ciena (NYSE:CIEN) are both computer and technology companies, but which is the better stock? We will contrast the two businesses based on the strength of their earnings, valuation, risk, dividends, institutional ownership, profitability and analyst recommendations.

Analyst Ratings

This is a breakdown of current recommendations and price targets for Fabrinet and Ciena, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Fabrinet 0 2 3 1 2.83
Ciena 0 2 20 0 2.91

Fabrinet currently has a consensus target price of $40.67, suggesting a potential upside of 12.28%. Ciena has a consensus target price of $29.60, suggesting a potential upside of 13.52%. Given Ciena’s stronger consensus rating and higher probable upside, analysts clearly believe Ciena is more favorable than Fabrinet.

Valuation and Earnings

This table compares Fabrinet and Ciena’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Fabrinet $1.42 billion 0.94 $97.11 million $2.57 14.09
Ciena $2.80 billion 1.33 $1.26 billion $1.49 17.50

Ciena has higher revenue and earnings than Fabrinet. Fabrinet is trading at a lower price-to-earnings ratio than Ciena, indicating that it is currently the more affordable of the two stocks.

Institutional and Insider Ownership

97.7% of Fabrinet shares are held by institutional investors. 3.3% of Fabrinet shares are held by insiders. Comparatively, 1.4% of Ciena shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Risk and Volatility

Fabrinet has a beta of 0.63, suggesting that its stock price is 37% less volatile than the S&P 500. Comparatively, Ciena has a beta of 1.34, suggesting that its stock price is 34% more volatile than the S&P 500.

Profitability

This table compares Fabrinet and Ciena’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Fabrinet 6.36% 12.48% 8.52%
Ciena 26.69% 9.92% 4.78%

Summary

Ciena beats Fabrinet on 9 of the 15 factors compared between the two stocks.

Fabrinet Company Profile

Fabrinet provides optical packaging and precision optical, electro-mechanical, and electronic manufacturing services to original equipment manufacturers of optical communication components, modules and sub-systems, industrial lasers, medical devices, and sensors. It offers a range of optical and electro-mechanical capabilities across the manufacturing process, including process design and engineering, supply chain management, manufacturing, printed circuit board assembly, packaging, integration, final assembly, and test. The company's products comprise switching products, such as reconfigurable optical add-drop multiplexers, optical amplifiers, modulators, and other optical components and modules that enable network managers to route voice, video, and data communications traffic through fiber optic cables at various wavelengths and speeds, and over various distances; tunable lasers, transceivers, and transponders; and active optical cables, which provide high-speed interconnect capabilities for data centers and computing clusters, as well as for Infiniband, Ethernet, fiber channel, and optical backplane connectivity. It also offers solid state, diode-pumped, gas, and fiber lasers used across semiconductor processing, biotechnology and medical device, metrology, and material processing industries; and sensors, such as differential pressure, micro-gyro, fuel, and other sensors used in automobiles, as well as non-contact temperature measurement sensors for the medical industry. In addition, the company designs and fabricates application-specific crystals, lenses, prisms, mirrors, and laser components and substrates, as well as other custom and standard borosilicate, clear fused quartz, and synthetic fused silica glass products. It has operations in North America, the Asia-Pacific, and Europe. The company was incorporated in 1999 and is based in George Town, the Cayman Islands.

Ciena Company Profile

Ciena Corporation provides hardware, software, and services that support the transport, switching, aggregation, service delivery, and management of voice, video, and data traffic on communications networks worldwide. The company's Networking Platforms segment offers hardware networking solutions optimized for the convergence of coherent optical transport, optical transport network switching, and packet switching. Its products include 6500 Packet-Optical Platform and the 5430 Reconfigurable Switching System, Waveserver stackable interconnect system, CoreDirector Multiservice Optical Switches, and OTN configuration for the 5410 Reconfigurable Switching System, as well as Z-Series Packet-Optical Platform; 3000 family of service delivery switches and service aggregation switches, and the 5000 family of service aggregation switches, as well as 8700 Packetwave Platform and the Ethernet packet configuration for the 5410 Service Aggregation Switch; and 4200 Advanced Services Platform, 5100/5200 Advanced Services Platform, Common Photonic Layer, and 6100 Multiservice Optical Platform. This segment also sells operating system software and enhanced software features embedded in each of its products. The company's Software and Software-Related Services segment offers network management solutions, including the OneControl Unified Management System, ON-Center Network & Service Management Suite, Ethernet Services Manager, Optical Suite Release, and Planet Operate; and Blue Planet network virtualization, service orchestration, and network management software platform, as well as related installation, support, and consulting services. Its Global Services segment provides consulting and network design, installation and deployment, maintenance support, and training services. The company sells its products through direct and indirect sales channels to network operators. Ciena Corporation was founded in 1992 and is headquartered in Hanover, Maryland.

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