You would be hard pressed to find too many tech stocks that still show upward momentum in their charts after the beating the sector took in October. Ciena Corp. (NYSE: CIEN) is one of the few that has been able maintain its momentum and keep within its trend.
We see on the daily chart that the stock has formed a trend channel over the last six months and the stock just bounced off of the lower rail of that channel. It is also worth noting that the stock barely dipped below its 50-day moving average before moving back above it yesterday. Most tech stocks have fallen below their 13-week and 52-week moving averages.
Ciena operates in the communication equipment group within the tech sector. The company’s fundamental indicators are slightly above average. The company has seen decent earnings growth with the most recent quarterly report showing 37% EPS growth on a year over year basis. The company sports a return on equity of 13.6% and a profit margin of 10%.
While the fundamentals are average to slightly above average, the real attraction to Ciena is the fact that it has held up better than the overall market and better than its sector.