Ciena initiated with a Sell at Citi

Citi initiated coverage of Ciena with a Sell rating and $44 price target. The analyst likes Ciena’s established leadership position in the optical transport market, particularly data center interconnect, but says the benefits from artificial intelligence networking traffic are still years out. The current wave of AI networking build out is occurring within the back end of the data center versus Ciena’s front end of network product offerings, the analyst tells investors in a research note. Citi believes Ciena’s data center interconnect potential opportunity is likely 18-24 months away once the traffic related to AI applications flows to other data centers or to consumers across the network.