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Will Lower Product Revenues Hurt Juniper (JNPR) Q1 Earnings?
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Juniper Networks, Inc. (JNPR - Free Report) is scheduled to report first-quarter 2018 financial results after the closing bell on May 1. The company is unlikely to report higher revenues in either of the operating segments due to volatile demand and stiff market competition.
Whether this could result in lower-than-expected earnings for the quarter remains to be seen.
Top-Line Contraction
Unfavorable global macro environment and weak investment patterns among customers are likely to hurt Juniper’s revenue growth. Ongoing consolidation in the telecom market is also expected to weigh on the company’s financials.
Moreover, Cloud revenues, which is expected to be $212 million in the to-be-reported quarter, is posing challenges for the company due to spending delay by cloud and hyper-scale customers as well as architectural transitions.
The Zacks Consensus Estimate for revenues from the Product segment (comprising Routing, Security and Switching products), which accounts for the lion’s share of total revenues, is currently pegged at $664 million, down from $829 million reported in first-quarter 2017.
For the first quarter, net revenues from Routing are expected to decrease to $397 million from $522 million reported in the year-ago quarter. Net revenues from Switching might come down to $202 million from $242 million reported in the previous-year quarter.
Revenues from the Service segment are expected to be $383 million compared with $392 million in the prior-year quarter. Consequently, total revenues for the quarter are likely to decline to $1,049 million from $1,221 million reported in the year-earlier quarter.
Other Factors
During the quarter, Juniper expanded its partnership with Affirmed Networks and Netronome to offer mobile providers a simple-to-manage, high-performing distributed mobile cloud solution for rapid deployment of Internet of Things and 5G services.
Additionally, Juniper and TIM have initiated a joint agreement to collaborate on the research and development of an innovative cloud-oriented network infrastructure in order to explore the viability of the platform based on automation, virtualization and open interfaces.
Juniper also introduced an expanded portfolio of offerings to bring businesses closer to a secure and automated multicloud environment. It aims to provide the infrastructure solutions organizations need to become multicloud-ready by adding to its robust portfolio of data center, campus, branch and cloud networking solutions.
The company augmented its unified cybersecurity platform with improved features to thwart data theft and other cyber-crimes. The strategic endeavor is aimed at empowering customers to run their business enterprises with increased confidence at higher efficiency level. Such technological collaborations and new product launches are likely to improve its market position and generate incremental revenues in future.
Our proven model does not conclusively show that Juniper is likely to beat earnings this quarter as it does not possess one of the two key components. A stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. This is not the case here as you will see below:
Zacks ESP: Juniper has an Earnings ESP of 0.00%, as both the Most Accurate estimate and the Zacks Consensus Estimate are pegged at 26 cents. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Juniper has a Zacks Rank #3, which when combined with a 0.00% ESP, makes surprise prediction difficult.
Note that we caution against stocks with a Zacks Rank #4 or 5 (Sell-rated) going into the earnings announcement, especially when the company is seeing a negative estimate revisions momentum.
Stocks to Consider
Here are some companies that you may want to consider, as our model shows that these have the right combination of elements to post an earnings beat this quarter:
Instructure, Inc. (INST - Free Report) has an Earnings ESP of +1.56% and a Zacks Rank #2.
IDEX Corporation (IEX - Free Report) has an Earnings ESP of +0.41% and a Zacks Rank #2.
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Image: Bigstock
Will Lower Product Revenues Hurt Juniper (JNPR) Q1 Earnings?
Juniper Networks, Inc. (JNPR - Free Report) is scheduled to report first-quarter 2018 financial results after the closing bell on May 1. The company is unlikely to report higher revenues in either of the operating segments due to volatile demand and stiff market competition.
Whether this could result in lower-than-expected earnings for the quarter remains to be seen.
Top-Line Contraction
Unfavorable global macro environment and weak investment patterns among customers are likely to hurt Juniper’s revenue growth. Ongoing consolidation in the telecom market is also expected to weigh on the company’s financials.
Moreover, Cloud revenues, which is expected to be $212 million in the to-be-reported quarter, is posing challenges for the company due to spending delay by cloud and hyper-scale customers as well as architectural transitions.
The Zacks Consensus Estimate for revenues from the Product segment (comprising Routing, Security and Switching products), which accounts for the lion’s share of total revenues, is currently pegged at $664 million, down from $829 million reported in first-quarter 2017.
For the first quarter, net revenues from Routing are expected to decrease to $397 million from $522 million reported in the year-ago quarter. Net revenues from Switching might come down to $202 million from $242 million reported in the previous-year quarter.
Revenues from the Service segment are expected to be $383 million compared with $392 million in the prior-year quarter. Consequently, total revenues for the quarter are likely to decline to $1,049 million from $1,221 million reported in the year-earlier quarter.
Other Factors
During the quarter, Juniper expanded its partnership with Affirmed Networks and Netronome to offer mobile providers a simple-to-manage, high-performing distributed mobile cloud solution for rapid deployment of Internet of Things and 5G services.
Additionally, Juniper and TIM have initiated a joint agreement to collaborate on the research and development of an innovative cloud-oriented network infrastructure in order to explore the viability of the platform based on automation, virtualization and open interfaces.
Juniper also introduced an expanded portfolio of offerings to bring businesses closer to a secure and automated multicloud environment. It aims to provide the infrastructure solutions organizations need to become multicloud-ready by adding to its robust portfolio of data center, campus, branch and cloud networking solutions.
The company augmented its unified cybersecurity platform with improved features to thwart data theft and other cyber-crimes. The strategic endeavor is aimed at empowering customers to run their business enterprises with increased confidence at higher efficiency level. Such technological collaborations and new product launches are likely to improve its market position and generate incremental revenues in future.
Our proven model does not conclusively show that Juniper is likely to beat earnings this quarter as it does not possess one of the two key components. A stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. This is not the case here as you will see below:
Zacks ESP: Juniper has an Earnings ESP of 0.00%, as both the Most Accurate estimate and the Zacks Consensus Estimate are pegged at 26 cents. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Juniper Networks, Inc. Price and EPS Surprise
Juniper Networks, Inc. Price and EPS Surprise | Juniper Networks, Inc. Quote
Zacks Rank: Juniper has a Zacks Rank #3, which when combined with a 0.00% ESP, makes surprise prediction difficult.
Note that we caution against stocks with a Zacks Rank #4 or 5 (Sell-rated) going into the earnings announcement, especially when the company is seeing a negative estimate revisions momentum.
Stocks to Consider
Here are some companies that you may want to consider, as our model shows that these have the right combination of elements to post an earnings beat this quarter:
Molina Healthcare, Inc. (MOH - Free Report) has an Earnings ESP of +6.81% and a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.
Instructure, Inc. (INST - Free Report) has an Earnings ESP of +1.56% and a Zacks Rank #2.
IDEX Corporation (IEX - Free Report) has an Earnings ESP of +0.41% and a Zacks Rank #2.
Looking for Stocks with Skyrocketing Upside?
Zacks has just released a Special Report on the booming investment opportunities of legal marijuana.
Ignited by new referendums and legislation, this industry is expected to blast from an already robust $6.7 billion to $20.2 billion in 2021. Early investors stand to make a killing, but you have to be ready to act and know just where to look.
See the pot trades we're targeting>>