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Juniper Rides on Solid Demand Trends & Portfolio Strength

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On Nov 27, we issued an updated research report on Juniper Networks, Inc. (JNPR - Free Report) , one of the leading providers of networking solutions and communication devices.

Juniper offers a broad range of routing, switching and security products. Routing includes products and services from the E, M, MX, PTX, T Series, and ACX router families. Switching primarily consists of products and services for EX Series and wireless local area network solutions, as well as QFabric. Security includes high-end SRX services and vGW Virtual Gateways, high-end Firewall virtual private network (VPN) systems and appliances, branch SRX, branch firewall, and J-Series product families, secure socket layer VPN appliances, intrusion detection and prevention appliances, and wide area network optimization platforms.

Juniper is on the verge of introducing the industry’s first 400-gig product and is well positioned to gain incremental market share as cloud, service provider and enterprise customers look to meet surging bandwidth requirements. The company is set to capitalize on the rising demand for data-center virtualization, cloud computing and mobile traffic packet/optical convergence. The company is offering its new suites of products, such as the T4000 core router, QFX data center platform, ACX and PTX packet/optical solution, among others.

With the exponential growth of smartphones and tablets, mobile data traffic has gone up. This has resulted in higher demand for advanced networking architecture, in turn leading service providers to spend more on routers and switches. Juniper is expected to benefit from the higher spending pattern among carriers to upgrade their networks in a bid to support the incremental growth in data traffic.

At the same time, the company remains optimistic about the potential of its MX5G offerings, which, it plans to begin shipping early next year. Juniper’s networking architecture runs on a single open source operating software named Junos. A common platform spanning across all the routing, switching and security areas reduces complexity in increasingly complex data centers. Juniper also offers a Software Development Kit to its partners and customers to enable additional customization. Leveraging the operating system, the company rolled out several products and enhancements over the past few years. We consider this to be a real differentiator, which gives Juniper a competitive advantage.

Juniper has recorded an average return of 1.6% in the past six months, while the industry declined 1.7%.


 

We remain impressed with the inherent growth potential of this Zacks Rank #2 (Buy) stock. Some other stocks in the industry worth considering are Comtech Telecommunications Corp. (CMTL - Free Report) , Ubiquiti Networks, Inc. (UBNT - Free Report) and QUALCOMM Incorporated (QCOM - Free Report) , each sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Comtech has long-term earnings growth expectation of 5%. It has trumped earnings estimates in each of the last four quarters, the average positive surprise being 136%.

Ubiquiti has long-term earnings growth expectation of 14%. It surpassed earnings estimates thrice in the trailing four quarters, the average positive surprise being 11.3%.

Qualcomm has a long-term earnings growth projection of 11.5%. It topped estimates in each of the preceding four quarters, the average positive earnings surprise being 18.5%.

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