Skip to main content

Market Overview

3 Reasons This Analyst Is Positive On Juniper Networks

3 Reasons This Analyst Is Positive On Juniper Networks

Shares of networking products company Juniper Networks, Inc. (NYSE: JNPR) are experiencing a valuation-sentiment disconnect, according to Oppenheimer.

The Analyst

Oppenheimer analyst Ittai Kidron upgraded Juniper from Perform to Outperform and established a price target of $33.

The Thesis

Recent, Inc. (NASDAQ: AMZN) weakness is due to a construction delay at an Amazon data center and an architectural change and not due to competitive displacement, Kidron said in a Monday note. The analyst expects to see improvement in the second half of 2018.

Tax reform positively impacts Juniper's free cash flow and increases the potential for a large buyback, Kidron said. The analyst expects the company's non-GAAP tax rate to fall from an average of 26 percent over the 2015-2017 period to about 17 percent, driving $100 million in incremental free cash flow annually.

If Juniper chooses to repatriate even half of the 84 percent of cash, cash equivalents and short-term investment it holds overseas, and use these for share repurchase, it could reduce its share count by 10 percent, Oppenheimer said. Under such a scenario, the firm sees multiples declining across the board.

Longer term, Juniper could suffer challenges, as routing is cannibalized by switching and campus switching struggles due to a lack of WLAN, Kidron said, but the overly bearish sentiment and the valuation discount following the tax reform set up a near-term opportunity.

"While it could take a few quarters for factors to be fully reflected in shares, we see solid upside opportunity," the note said.

The Price Action

Juniper Networks shares are up 3.5 percent over the past year, trading recently around $28.23.

Related Links:

Cisco's Transition Is In 'Full Swing'

Why Fortinet Belongs In The Conversation With Cisco And Palo Alto

Latest Ratings for JNPR

Apr 2021Credit SuisseMaintainsUnderperform
Apr 2021Raymond JamesMaintainsOutperform
Apr 2021NeedhamMaintainsBuy

View More Analyst Ratings for JNPR
View the Latest Analyst Ratings


Related Articles (JNPR)

View Comments and Join the Discussion!

Posted-In: Ittai Kidron OppenheimerAnalyst Color Upgrades Price Target Analyst Ratings Best of Benzinga

Latest Ratings

FIBKStephens & Co.Downgrades
LEAFCanaccord GenuityDowngrades8.5
AGMSidoti & Co.Downgrades115.0
KEXGabelli & Co.Downgrades
OCGNCantor FitzgeraldDowngrades11.0
View the Latest Analytics Ratings
Don't Miss Any Updates!
News Directly in Your Inbox
Subscribe to:
Benzinga Premarket Activity
Get pre-market outlook, mid-day update and after-market roundup emails in your inbox.
Market in 5 Minutes
Everything you need to know about the market - quick & easy.
Fintech Focus
A daily collection of all things fintech, interesting developments and market updates.
Everything you need to know about the latest SPAC news.
Thank You

Thank you for subscribing! If you have any questions feel free to call us at 1-877-440-ZING or email us at