Bank of America Downgrades Ciena (CIEN), Morgan Stanley Lowers PT

Group 1 - Ciena Corporation (NYSE:CIEN) has been downgraded by BofA Securities from Buy to Neutral due to cautious outlook on near-term spending in AI-driven networking, although long-term prospects remain solid [1][3] - BofA Securities highlighted that valuations for networking stocks are currently above historical levels, with hyperscaler capital expenditure growth expected to slow to 39% in 2026 from 68% in 2025 [2] - The investment firm suggests that the slowdown in hyperscaler spending may shift investor focus towards order trends, backlog, and deferred revenue, indicating a more challenging near-term outlook for the sector [3] Group 2 - Morgan Stanley maintained its Equal Weight rating on Ciena Corporation and reduced its price target from $195 to $213, reflecting a cautious stance on the stock [4] - While Ciena shows potential as an investment, there are suggestions that certain AI stocks may offer greater upside potential with less downside risk [5]