Jon,

After the euphoria of the AH $12.50 action on INFN, they 20% market cap blowoff is a huge hangover, dwarfing whatever premium gained on the options. It also makes your CIEN play look good, if you did pull the trigger on those options, which IIRC you did. While we should be used to 15-20% changes on these stocks following, CC's, I'm just feeling like Charlie Brown and the football at this point. When the hell will I learn? I'll be interested to hear what lt cap makes of this.

Jamok,

The reaction to the "pricing pressure" comments on the CC while understandible, are simply overdone and quite short sided.  The company's mid term future is now far better than it has been over the past 2 years.  I went contrarian and bought some shares the CC. This is only a trade, but I see much better days ahead.

lt cap,

I'm glad to hear that the 'pricing pressure' isssue may well be less dire than it was interpreted by the analysts (and the stock market by voting to the woodshed for punishment, as INFN got initially crushed.)  I had been wondering whether the sector has something of a 'no win' feature built in: In times of capex drought, everyone suffers to one degree or another. As capex begins to flow, the sector might get into 'bidding wars', sacrificing margins to garner business. If that were true, it might only be in a 'capex flood' situation that real, sustained profits can be made. But I am mindful that once you buy equipment, you are married to that equipment for the life of its cycle - can't use Ford parts in a Chevy, and so to almost 'give away' initial equipment would be made up on the back end, as a company becomes a 'sole vendor'. I do wonder when a company, say a telecom company, uses several suppliers, whether these are for decrete segments of their hardware, or whether it allows them some flexibility in who they buy from. Probably the former. Regardless, the whole sector, including NOK are having a hard time of it today. It makes me start to think about buying more CIEN, as it's been in a downtrend even before INFN reported. But we all know how inaccurate trying to pre-guess how CCs are. I would think it mandatory that in the CIEN CC there has to be analyst's questions about pricing pressure, since it was CIEN that was specifically named in the INFN CC. If CIEN could convincingly dispel that pricing impact.......?

Jamok,

While pricing pressures exist, I just think the reaction to the comment was exagerated.  That said, I believe some of what you state is correct.  However, it will subside to some extent as the cycle progresses, IMO this cycle will be longer than past ones.  After holding back on CapEx for so long snd with 5G starting, there is a backlog of needed capacity.  

Jamok, here is your chance with CIEN under 25. Of course who knows if it bounces back to 27/28 or falls from here, lol.

Jon,

I was playing all morning with the idea of writing calls on CIEN. Then I found out today's the last day to trade before earnings before the bell tomorrow. So I sold 5 calls stk $24.50 for .80. Altho a news story says that CIEN is expected to announce a rise in revenues, the stock has been dropping steadily, as though someone knows something negative that we don't. And to earn a $400 max gain, when a stock (such as INFN) can drop 15% on an earnings call deemed bad by analysts, and then can drop *another* 10% on a single downgrade - well, betting that CIEN will have a good CC and I'll get a whopping $400 for my efforts (I bought it at $24.23), says something about my investing strategy - as the Bard put it, "A tale told by an idiot." Maybe I 'get lucky'. Hope so.

(BTW,  I tried this strategy with INFN - I bought 500 shares around $11.77 and then wrote calls on them. I also bought 500 shares of CIEN to matach the calls I wrote, so my 1k shares are intact.)

Bought another 5oo sh at 23.56.  I believe the CIEN story more than INFN although both have potential over the next 6 months plus.  INFN might be more due to 5g expansion, but I think CIEN seems to be gaining the market share and once margins rebound will see the benefits big time.  Sort of like INFN a few years back.

Jon,

Probably a good buy. The thing that I don't have an answer to, but wish I did, is this: In secular terms, every stock in the sector should tend to do better rather than worse, as 5g begins a real rollout and the shadow of the capex drought receeds. I wonder to what extent companies will have to piss away large margins, and get into 'price wars' in order to lure adopters of their initial equipment order. Which, if true, would make the question of who has the *best* proprietary technology critical, for a given task or area. I've no idea of the answer to that. That was the INFN story, but the (was it Morgan Stanley?) analyst who cratered the stock several days ago by dropping it to 'underperform' cited a technology lag/deficit in comparison to other vendors as one of the reasons for his ratings drop. lt cap might have the clearest view on that, I'd think.

I agree.  However, all Networking stocks are not getting the respect they deserve if you consider that 5G is in front of this market.  Typical, they get trashed before the inflection point, how many times have we seen that happened?

We are talking less than 6 months before these companies start beating estimates and guiding higher.  Color me bullish on the sector, but don't listen to me because my timing always suck, underline timing always sucks! LOL