What’s Happening With Juniper Stock?

JNPR: Juniper Networks logo
Juniper Networks

Juniper (NYSE:JNPR), a company that sells networking products, including routers, switches, network management software, network security products, and software-defined networking technology, has seen its stock underperform a bit, falling by about 2% year-to-date, compared to the S&P 500 which remains up by 2% over the same period. There are a couple of factors impacting the stock. Firstly, recent earnings from the company have been mixed. For Q4 2022, while earnings were in line with estimates at $0.65 per share, revenues missed estimates, although they rose by 11.5% year-over-year to $1.45 billion. Moreover, investors have also been a bit concerned about the broader macro environment, with customers getting more cautious about their spending. This could impact IT budgets to an extent, hurting networking solutions vendors such as Juniper.

So what’s the outlook like for Juniper stock? There are a couple of tailwinds that we see for Juniper. Juniper has also been making efforts to increase its enterprise sales. Over Q4 2022, sales to enterprise clients rose by about 30% year-over-year. Moreover, supply chain-related issues also appear to be easing for the company with Covid-19 receding. Juniper is also seeing strong demand for high-speed 400G ethernet network equipment, particularly from cloud and hyper-scaler customers. The company also sees an opportunity for the Wi-Fi 6-led wireless refresh. That being said, there are some concerns as well. Juniper trades at about 13x forward earnings, roughly in line with rival Cisco, which is the market leader in the space. However, Cisco is expected to post slightly better growth in the near term and also has a better scale in terms of its client base and supply chain. We remain neutral on Juniper stock, with a $31 price estimate, which is roughly in line with the current market price. Check out our analysis of Juniper valuation: Expensive or cheap for more details on what’s driving our price estimate for Juniper. Also, see our analysis of Juniper Revenue for a look at the company’s key revenue streams and how they have been trending.

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Returns Mar 2023
MTD [1]
YTD [1]
Total [2]
 JNPR Return 2% -2% 11%
 S&P 500 Return -1% 2% 75%
 Trefis Multi-Strategy Portfolio -4% 3% 224%
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[1] Month-to-date and year-to-date as of 3/20/2023
[2] Cumulative total returns since the end of 2016

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