Breaking News
Ad-Free Version. Upgrade your experience. Save up to 40% More details

Juniper Networks Stock Is A Laggard Networking Play

By (Jea Yu )Stock MarketsApr 07, 2021 05:38AM ET
Juniper Networks Stock Is A Laggard Networking Play
By (Jea Yu )   |  Apr 07, 2021 05:38AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items

Network communications company Juniper Networks (NYSE:JNPR) stock has been chopping in a trading range for nearly a decade. The legacy networker has been profitable, consistent, with a war chest of $1.78 billion in cash or $5.44 cash per share and a 3.12% dividend. The Company has been quietly gobbling up companies to bulk up its portfolio of data center and networking services trading at 2X book value. While growth has slow, it’s become a value play for those seeking steady Eddie performance. The PE 33X is cheap compared to the industry average of 43X. The 5G rollout is a major tailwind that doesn’t seem to be priced in by the markets. As COVID vaccinations accelerate and workers return to offices, Juniper’s enterprise business should see a return to normalcy as it benefits as a re-opening play.

Q4 FY 2020 Earnings Release

On Jan. 28, 2021, Juniper reported its Q4 2020 results for the quarter ending December 2020. The Company reported earnings-per-share (EPS) of $0.55 versus consensus analyst estimates for $0.53, a $0.02 beat. Revenues grew 1.2% year-over-year (YoY) to $1.22 billion, beating analyst estimates of $1.19 billion by $300 million.

Juniper Flat Q1 2021 Guidance

Juniper issued flat guidance for Q1 2021 for EPS in the range of $0.20 to $0.30 versus $0.25 consensus analyst estimates. The Company expects revenues between $1.005 to $1.05 billion versus $1.03 billion. The Company expects non-GAAP gross margins to experience normal season patterns excluding impacts of COVID-related costs, non-GAAP gross margin is approximately flat YoY.

Conference Call Takeaways

Juniper CEO, Rami Rahim, set the tone:

“Focusing on our specific use cases, which include AI-driven enterprise, cloud-ready data centers and automated WAN with connected security embedded in each… We have reorganized our sales, product management and engineering teams around these business opportunities.”

He went on:

“Capturing the value presented by our recent acquisition and making sure 128 Technology, Apstra and Netrounds deliver similar returns on investment to what we are seeing with Mist, which continues to exceed expectations and it’s positively impacting sales of the broader Juniper portfolio.”

The Company seeks to capitalize on the major tailwinds of 5G and 400 gig, which can last for several years. Enterprise growth returned in December exceeding expectations with high single digit YoY growth in line with re-openings and COVID vaccinations.

Mist and 128 Technology Growth Engines

Juniper saw particularly strong demand in North America but was widespread throughout geographies:

“We secured a significant multi-year opportunity with an international global 10 account for our wireless, wired and SDRAM portfolio driven by our Mist AI differentiation.”

CEO Rahim foresees the enterprise business experiencing the fastest growth in 2021:

“Our optimism is fueled by the building customer response to our AI-driven enterprise offerings and specifically the momentum we are seeing around Mist, which saw logos grow by more than 125% year-over-year and orders increased by 140% year-over-year.”

Mist minimizes IT costs with proactive and self-routing automation assuring secure user experiences with AI-driven support and end-to-end service levels. Gartner recently listed Juniper in the Leaders Quadrant for wireless and wired access execution. Recently acquired 128 Technology will drive the next evolution of the AI-driven vision with superior application end-user SD-WAN experience while extending the value of Mist secure AI-engine and cloud management from client to cloud.

Four Themes in One Stock

Juniper has four themes as a value play, 5G rollout play, internet infrastructure play and a re-opening play. The flat forward guidance is priced in and the bar is set rather low so any upside surprise could break shares out of a decade-long price range consolidation. Investors looking for a multi-theme player on the verge of a breakout can monitor shares for opportunistic pullback levels to gain exposure.

Juniper Networks Stock Chart
Juniper Networks Stock Chart

JNPR Opportunistic Pullback Levels

Using the rifle charts on the weekly and daily time frames provides a precision view of the landscape for JNPR stock. The weekly rifle chart has a pup breakout with a rising 5-period moving average (MA) support at $25.13 and upper Bollinger Bands (BBs) near the $27.76 Fibonacci (fib) level. The weekly stochastic crossed back up to fuel the breakout higher. The daily rifle chart formed a market structure low (MSL) trigger above $24.13 and a market structure high (MSH) sell trigger below $29.99. The daily rifle chart has a double barrel pup breakout with a rising 5-period MA at $25.59 powered by a stochastic mini pup targeting the upper BBs at the $26.61 fib. Prudent investors can monitor opportunistic pullback levels at the $25.25 fib, $24.35 fib, $23.19 fib, $22.52 fib, and the $21.37 fib. Keep an eye on peer CSCO as they tend to move together as networkers. Upside trajectories range from the $28.44 fib up to the $33.41 fib level.

Original Post

Juniper Networks Stock Is A Laggard Networking Play

Related Articles

Juniper Networks Stock Is A Laggard Networking Play

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind: 

  • Enrich the conversation
  • Stay focused and on track. Only post material that’s relevant to the topic being discussed.
  • Be respectful. Even negative opinions can be framed positively and diplomatically.
  •  Use standard writing style. Include punctuation and upper and lower cases.
  • NOTE: Spam and/or promotional messages and links within a comment will be removed
  • Avoid profanity, slander or personal attacks directed at an author or another user.
  • Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at’s discretion.

Write your thoughts here
Are you sure you want to delete this chart?
Post also to:
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Are you sure you want to delete this chart?
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
Sign up with Email