Here’s Why Giverny Capital Opted to Sell Ciena Corporation (CIEN)

Giverny Capital Asset Management, LLC, an investment management company, recently published its third-quarter 2023 investor letter. A copy of the same can be downloaded here. The firm’s model portfolio returned -3.01% (net) in the third quarter compared to -3.27% return for the S&P 500 Total Return Index. YTD, the fund returned 11.02% compared to the 13.07% return for the Index. In addition, please check the fund’s top five holdings to know its best picks in 2023.

Giverny Capital Asset Management highlighted stocks like Ciena Corporation (NYSE:CIEN) in the third quarter 2023 investor letter. Headquartered in Hanover, Maryland, Ciena Corporation (NYSE:CIEN) provides network and communication infrastructure. On November 6, 2023, Ciena Corporation (NYSE:CIEN) stock closed at $43.22 per share. One-month return of Ciena Corporation (NYSE:CIEN) was -3.22%, and its shares lost 5.51% of their value over the last 52 weeks. Ciena Corporation (NYSE:CIEN) has a market capitalization of $6.39 billion.

Giverny Capital Asset Management made the following comment about Ciena Corporation (NYSE:CIEN) in its Q3 2023 investor letter:

“We had a few transactions during the quarter. We exited our small position in Ciena Corporation (NYSE:CIEN at a loss. Ciena is a technology leader in network communications infrastructure. It’s largest competitor, the Chinese company Huawei, has been banned from many Western nations for fears that it cooperates with the Chinese government in spying on customers. We bought Ciena with an expectation that its future looked bright given healthy demand from both telecom and cloud computing customers, plus a less competitive bidding environment.

Unfortunately, we were disappointed with Ciena’s difficulties managing its supply chain, inventory level and backlog. We opted to sell the stock in the belief we could find better opportunities elsewhere.”

A software engineer debugging a complex communications infrastructure.

Ciena Corporation (NYSE:CIEN) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 35 hedge fund portfolios held Ciena Corporation (NYSE:CIEN) at the end of second quarter which was 32 in the previous quarter.

We discussed Ciena Corporation (NYSE:CIEN) in another article and shared the list of best mid-cap value stocks to buy. In addition, please check out our hedge fund investor letters Q3 2023 page for more investor letters from hedge funds and other leading investors.

 

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Disclosure: None. This article is originally published at Insider Monkey.