Market Overview

Juniper Networks Buys Mist Systems For $405M: 2 Analyst Takes

Share:
Juniper Networks Buys Mist Systems For $405M: 2 Analyst Takes

Networking developer Juniper Networks, Inc. (NYSE: JNPR) has reached an agreement to acquire Mist Systems, a cloud-managed wireless network solution company often described as "the Waze for Wi-Fi" for $405 million.

The Analysts

Piper Jaffray's James Fish maintains a Neutral rating on Juniper Networks with an unchanged $27 price target.

Morgan Stanley's James Faucette maintains at Underweight, unchanged $20 price target.

Piper Jaffray: 'Bold Move' Should Be Applauded

Mist Systems is among the few remaining standalone WLAN vendors and represents a "great" strategic fit under Juniper's control due to the rising importance of the Edge and the convergence of networking, Fish said in a Monday note.

Mist's business consists of an AI-driven WLAN platform that collects over 150 user states every few seconds and offers valuable insights from the information, the analyst said. 

While the near-term impact of the acquisition is neutral for Juniper, it has a long-term positive impact, as it strengthens the company's competitive positioning — and management should be applauded for the "bold move," Fish said. 

Before Piper Jaffray turns bullish, the company needs to properly execute on the acquisition, and the integration with existing products needs to play out, the analyst said. 

Morgan Stanley Sees Small Benefit

Juniper Networks' largest acquisition in more than a decade comes at a time when the company has shown an inability to capitalize on an inorganic strategy against much larger competitors like Cisco Systems, Inc. (NASDAQ: CSCO) which boasts $41 billion in cash and can consistently outbid for any asset on the market, Faucette said in a Monday note. 

Juniper's latest acquisition gives it exposure to the $6-billion wireless LAN market, which Cisco and other large-cap peers already have, the analyst said.

Juniper and Mist Systems have been selling products together through a partnership, so their products are already integrated, Faucette said. As such, any net benefit to Juniper will be marginally accretive in 2020 and beyond, he said. 

Aside from the acquisition, Juniper continues to face broader challenges in the enterprise market, including potential share loss, the analyst said, adding that a bearish stance continues to be justified.

Price Action

Juniper Networks shares were down 1.37 percent at $26.63 at the time of publication Tuesday.

Related Links:

Should Investors Buy The Dip In Juniper Networks? The Street Debates

Juniper Networks Powered By Several Growth Drivers, Nomura Instinet Says In Upgrade

Latest Ratings for CSCO

DateFirmActionFromTo
Oct 2019MaintainsOverweight
Oct 2019DowngradesBuyNeutral
Sep 2019Initiates Coverage OnOutperform

View More Analyst Ratings for CSCO
View the Latest Analyst Ratings

Posted-In: cloud James FaucetteAnalyst Color M&A News Price Target Reiteration Analyst Ratings Best of Benzinga

 

Related Articles (CSCO + JNPR)

View Comments and Join the Discussion!

Latest Ratings

StockFirmActionPT
ELMDDougherty & Co.Initiates Coverage On12.0
MRNSCantor FitzgeraldAssumes7.0
MNRLCapital One FinancialInitiates Coverage On23.0
SONVertical GroupUpgrades
UNPMorgan StanleyMaintains136.0
View the Latest Analytics Ratings
Don't Miss Any Updates!
News Directly in Your Inbox
Subscribe to:
Benzinga Trading Daily
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.
Daily Analyst Rating
A summary of each day’s top rating changes from sell-side analysts on the street.
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 vipaccounts@benzinga.com

Markets React Amid Report FDA Commish Scott Gottlieb Will Resign

Morgan Stanley: 'Something Just Doesn't Add Up' With Tesla