Juniper Networks Received its Third Buy in a Row

By Jason Carr

After Credit Suisse and Nomura assigned a Buy rating to Juniper Networks in the last month, the company received another Buy, this time from Drexel Hamilton. Analyst Brian White reiterated a Buy rating on Juniper Networks (NYSE: JNPR) today and set a price target of $36. The company’s shares closed yesterday at $27.80.

White wrote:

“We believe Juniper will at least meet our 1Q:2017 revenue estimate of $1.226 billion (Street is at $1.205 billion) and slightly exceed our EPS projection of $0.43 (Street is at $0.42). Our 1Q:2017 sales forecast represents a 12% QoQ decline and weaker than the five-year average decrease of 9%. Recall, Juniper’s Q1:2017 outlook calls for sales of $1.17 billion to $1.23 billion and pro forma EPS of $0.38-0.44. After a negative March quarter preannouncement in April 2016 on weak spending patterns and the subsequent impact of increased pricing pressure in EMEA that led to a disappointing gross margin performance starting in 2Q:16, Juniper struggled last year and the stock underperformed the S&P 500 Index by seven percentage points. However, we expect the company’s product cycle will make a more important revenue contribution in H2:2017 and gross margin can begin to rise on a YoY basis in 3Q:17. Through product innovations such as QFX and PTX, we believe Juniper is well-positioned to help service providers re-architect their networks and participate in the strong secular growth trends at leading cloud providers. Moreover, we believe the company’s security portfolio has an opportunity to deliver more stable performance in 2017.”

According to TipRanks.com, White is a 5-star analyst with an average return of 10.0% and a 64.8% success rate. White covers the Technology sector, focusing on stocks such as Salesforce.com, Amphenol Corp, and Cisco Systems.

Currently, the analyst consensus on Juniper Networks is Moderate Buy and the average price target is $28.38, representing a 2.1% upside.

In a report released yesterday, Credit Suisse also maintained a Buy rating on the stock with a $31 price target.

Based on the recent corporate insider activity of 73 insiders, corporate insider sentiment is negative on the stock. Most recently, in February 2017, Pradeep Sindhu, the EVP CTO of JNPR sold 100,000 shares for a total of $2,795,000.

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Juniper Networks, Inc. engages in the design, development, and sale of products and services for network businesses. It operates through Americas and EMEA (Europe, Middle East, and Africa) geographical segments. The company was founded by Pradeep S. Sindhu on February 6, 1996 and is headquartered in Sunnyvale, CA.