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Juniper Networks' Short-Term Problems Shouldn't Scare Investors

August 19, 2014 | About:



Juniper Networks (JNPR) was downgraded from outperform to neutral by Mizuho. The analyst firm ascribed softness in capital spending by customers like AT&T (T) and Sprint (S) in the short term, sending the stock lower. Nonetheless, from a long-haul perspective, Juniper looks strong, and the late weakness in the share cost is a chance to get some shares. Let’s see why.

Consistent performances

Juniper has performed consistently in the last year. The as of late reported first-quarter was the same, as its revenue increased 10% year-over-year to $1.17 billion, beating the Wall Street estimate of $1.15 billion.

Juniper is looking at cutting costs. It is turning out inventive products to develop the business, and this is clear from its money-related performance. A look at the organization's strategies and long-haul prospects will make it clear why it should be purchased on the pullback.

Development prospects

Juniper is working with AT&T to convey a user-characterized system cloud. Recently, AT&T said it will start taking off software-characterized systems administration (SDN) and other system virtualization functions under the Domain 2.0 project to power cutting-edge networks. The move to a cloud-based system by AT&T will be a growth catalyst for Juniper as the organization specializes in giving products and services to top networks.

AT&T is looking to enhance its equipment and software value while also enhancing the administration of usefulness in the software layer. Moreover, the company will attempt to convey security, performance and dependability to users, separated from tapping new services and apps. Since Juniper focuses on both the fittings and software sides of the systems administration spectrum, it can partner successfully with AT&T on this activity.

Additionally, Juniper is witnessing robust interest from service providers across the Web 2.0 stage, alongside carriers in all geographies. Also, Enterprise customers should help it catch share in the significant, high-development segment for its cloud-developer and savvy systems administration services across the globe.

Juniper is attempting to bring more customers into its crease by conveying a solid worth proposition, which request profoundly scaled, sophisticated, secure, robotized, setting mindful networks and cloud environments. These applications oblige center directing solutions, switching, security, virtualization capabilities and system sagacity and control to cooperate in an open structure.

To profit from these applications, Juniper has actualized a One-Juniper structure to make a more focused, joined, spry, and execution-turned organization.

LTE opportunity

Administration expects that Juniper's nitty gritty execution arrangement of de-layering, robotization and focused development will strengthen the organization by applying its resources to high-development areas of the business sector.

One such open door is in 4g LTE, where Juniper's optical products should see strong interest. AT&T is aggressively conveying its LTE presence in the U.S. Additionally, there are reports that Sprint and T-Mobile – the third and the fourth-largest mobile networks in the U.S. – will join to make a telecom powerhouse.

Sprint's LTE system reaches 225 million individuals so far. Indeed, T-Mobile covers an indistinguishable number of customers with its 4g service so it could be required to step on the gas as well. Sprint is wanting to try for aggressive deployments of its faster networks going ahead. This expansion will oblige capital investments and should result in higher orders for Juniper.


Investors need to look past any short-term torment that Juniper may confront, and instead focus on its long haul prospects. The organization should profit from growth in cloud infrastructure and the arrangement of LTE networks, and at a forward P/E ratio of only 12, it would seem that it is a solid investment.

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