Is Juniper Networks (JNPR) Poised to Beat Estimates? - Analyst Blog

Juniper Networks JNPR is set to report first-quarter 2014 results on Apr 22. Last quarter, the company posted a positive earnings surprise of 22.2%. Let us see how things are shaping up for this announcement.

Growth Factors This Past Quarter

Juniper Networks posted better-than-expected fourth-quarter results wherein both top- and bottom lines not only beat the Zacks Consensus Estimate but also improved on a year-over-year basis. Results were primarily aided by strong contribution from its end markets (service providers and enterprises) and cost rationalizations.

Additionally, the company's expansion into the software defined network segment is expected to strengthen its position in the networking space. Moreover, increased spending by service providers should support Juniper's near-term fundamentals.

While the company's new products, cost reduction initiatives and improving execution remain catalysts, increasing competition from Cisco CSCO and AT&T T, uncertain economic conditions are the possible headwinds.

Earnings Whispers?

Our proven model does not conclusively show that Juniper Networks will beat earnings this quarter. That is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1, 2 or 3 for this to happen. That is not the case here as you will see below.

Zacks ESP: Both the Most Accurate estimate and the Zacks Consensus Estimate stand at 19 cents. Hence, the difference is 0.00%.

Zacks Rank: Juniper Networks' Zacks Rank #1 (Strong Buy) when combined with a 0.00% ESP makes surprise prediction difficult.

We caution against stocks with Zacks Ranks #4 and 5 (Sell-rated stocks) going into the earnings announcement, especially when the company is seeing negative estimate revisions momentum.

Other Stocks to Consider

Here is another company you may want to consider as our model shows that it has the right combination of elements to post an earnings beat this quarter:

ON Semiconductor Corp. ONNN has an Earnings ESP of +6.67% and holds a Zacks Rank #1