SIGNALCapital Markets·May 26, 2026, 4:56 PMSignal55Short term

Ciena, Cisco get price target hikes at BofA as optical networking growth stays strong

Why this matters
Why now

The increased demand for data center connectivity due to AI requires robust optical networking infrastructure, leading analysts to revise expectations for key players in the sector.

Why it’s important

This indicates continued strong investment in the foundational infrastructure that supports the ongoing digital transformation and the burgeoning AI industry.

What changes

Market sentiment and valuations for optical networking companies are strengthening as their role in supporting high-bandwidth applications becomes clearer.

Winners
  • · Ciena
  • · Cisco
  • · Optical Networking Sector
  • · Data Center Operators
Losers
    Second-order effects
    Direct

    Increased stock prices and investor confidence for optical networking companies due to favorable analyst ratings.

    Second

    Accelerated investment and innovation in optical network technologies to meet rising demand, potentially leading to new product cycles.

    Third

    Enhanced global connectivity and reduced data latency, indirectly supporting further expansion of AI applications and cloud services worldwide.

    Editorial confidence: 85 / 100 · Structural impact: 40 / 100
    Original report

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