Pacific Crest Cuts Targets on Networking Stocks as Trough Valuation Approaches (JNPR) (RVBD) (FFIV) (ARUN)

June 22, 2012 11:28 AM EDT
Get Alerts JNPR Hot Sheet
Price: $27.34 --0%

Rating Summary:
    17 Buy, 31 Hold, 2 Sell

Rating Trend: = Flat

Today's Overall Ratings:
    Up: 23 | Down: 31 | New: 34
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Stocks in the Networking group are bouncing Friday morning following a sharp move lower on Thursday. Traders are buying the sector despite a cautious research note from Pacific Crest's Brent Bracelin earlier.

The analyst cited a flurry of upcoming economic headwinds related to currency and a lengthening sales cycle. Bracelin was also concerned with lower multiples across the board for Networking stocks. He sees the IT hardware industry "approaching trough valuation" and believes news flow will remain negative for the next month. Bracelin is anticipating a pick up in late summer or fall.

Despite the worries, Bracelin maintains an Outperform on the following stocks, but reduced price targets:
  • Juniper (Nasdaq: JNPR) from $24 to $20;
  • Riverbed (Nasdaq: RVBD) from $34 to $27;
  • F5 Networks (Nasdaq: FFIV) from $153 to $145;
  • Acme Packet (Nasdaq: APKT) from $38 to $31;
  • Aruba Networks (Nasdaq: ARUN) from $30 to $22; and
  • Ubiquiti Networks (Nasdaq: UBNT) from $36 to $27.
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