Q4 Preview: Juniper (JNPR) - 'Router' You Talking About?
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Juniper Networks, Inc. (Nasdaq: JNPR) is lower today ahead of the company's fourth quarter earnings release, expected out after the market closes. Shares are down 0.57% today.
JNPR is expected to report EPS of $0.37 with revs of $1.12 billion. Last quarter, the Sunnyvale, CA-based techie posted EPS of $0.32 on revs of $1.01 billion, just about in-line with views. Looking at Q409, we see Juniper produce EPS of $0.32 paired with revs of $941.5 million, topping Street views looking for EPS of $0.26 and revs of $884.81 million.
Shares gained 21.9% through the quarter, to $36.92 at the end of December. The stock is down 5.8% since then, but made a good run through 2010, ending 35.8% higher.
A simple valuation puts Juniper with a forward P/E of 22.5x FY11 EPS estimates, a little rich when compared to 17.1x at Alcatel-Lucent (NYSE: ALU) and 11.7x for Cisco (Nasdaq: CSCO).
Data from Bloomberg has 25 analysts with a Buy on JNPR, 16 with a hold, and two suggesting to Sell. The analyst price target average is $38, with a high of $46 and low of $28. Shares have traded in a range of $38.73 - $22.25 over the last 52-weeks.
Summary
Juniper is expecting Q410 adjusted EPS of $0.35 - $0.37 on revs of $1.10 - $1.14 billion, which it issued along with its third quarter earnings announcement.
Goldman Sachs is looking for solid results from the company, though short interest is at its lowest levels since 2005. They would add to any positions on a "sell the news" dip. They're looking for EPS of $0.38 on revs of $1.123 billion. Their EPS estimate suggests upside from solid operating leverage amid a $0.01 hit from the SMobile acquisition.
Goldman says that they "believe the quarter benefited from continued strong growth in service provider routers (GSe up 9% qoq and 18% yoy) as carriers are ramping capacity investments to meet accelerating traffic demand – a trend that we believe was strengthened by the accelerated shift to over-the-top video in 4Q." Goldman has a Buy on the shares, with a $44 price target.
Wedbush sees near-term momentum with service providers as "they look to more aggressively invest in their network infrastructure to handle increases in data traffic." Wedbush believes that "positive near-term trends will outweigh concerns about global growth, pricing and competition but [they] remain concerned that competition in the enterprise market, as evidenced by discounting, which [they] think could pose some risk to the company’s longer-term revenue and operating model targets."
Wedbush is looking for EPS of $0.38 and revs of $1.13 billion. They have a Neutral on the shares, with a $34 price target.
Wells Fargo sees a report toward the high-end of guidance, and a Q111 outlook including "qualitative commentary regarding the ramp of new products and end market demand to drive consensus estimates higher post the call." Their checks affirms this conclusion. They are looking for EPS of $0.37.
Wells is modeling gross margins of 67.5% and operating margins of 25%, compared to guidance of 66% - 68% and 24.5%, respectively. Wells has an Outperform on the shares with a valuation range of $41 to $43.
Miller, Tabak, + Co. is surprised that no one is talking about Core Routers. Though the Service Provider Core Router market has traditionally been Juniper's bread-and-butter, Miller Tabak thinks that this could change.
On the market, Miller comments, "We have been looking hard at the Core Router market as a result of comments from Ciena. They noted the last remaining component to enable deployment of 100G in the Service Provider footprint is actually the availability of cost effective and volume available Cisco and Juniper 100G router blades. For Service Providers the benefits of deploying 100G OTN Optical Transport in the Metro and Long Haul infrastructure is significantly enhanced by the availability of 100G downlink blades from the Core routers." Replacement will come in three waves, with the initial demand trickling in, followed by replacement of line cards in the installed base, and then the replacement of old router chassis.
Miller Tabak's looking for Q410 EPS of $0.37.
Juniper Networks is expected to release their Q410 earnings on Tuesday, January 25, 2011, at approximately 4:00pm EST. Stay tuned to StreetInsider.com's EPS Insider section to see our analysis of the highly-anticipated quarterly results withi0 n seconds of their release.
JNPR is expected to report EPS of $0.37 with revs of $1.12 billion. Last quarter, the Sunnyvale, CA-based techie posted EPS of $0.32 on revs of $1.01 billion, just about in-line with views. Looking at Q409, we see Juniper produce EPS of $0.32 paired with revs of $941.5 million, topping Street views looking for EPS of $0.26 and revs of $884.81 million.
Shares gained 21.9% through the quarter, to $36.92 at the end of December. The stock is down 5.8% since then, but made a good run through 2010, ending 35.8% higher.
A simple valuation puts Juniper with a forward P/E of 22.5x FY11 EPS estimates, a little rich when compared to 17.1x at Alcatel-Lucent (NYSE: ALU) and 11.7x for Cisco (Nasdaq: CSCO).
Data from Bloomberg has 25 analysts with a Buy on JNPR, 16 with a hold, and two suggesting to Sell. The analyst price target average is $38, with a high of $46 and low of $28. Shares have traded in a range of $38.73 - $22.25 over the last 52-weeks.
Summary
Juniper is expecting Q410 adjusted EPS of $0.35 - $0.37 on revs of $1.10 - $1.14 billion, which it issued along with its third quarter earnings announcement.
Goldman Sachs is looking for solid results from the company, though short interest is at its lowest levels since 2005. They would add to any positions on a "sell the news" dip. They're looking for EPS of $0.38 on revs of $1.123 billion. Their EPS estimate suggests upside from solid operating leverage amid a $0.01 hit from the SMobile acquisition.
Goldman says that they "believe the quarter benefited from continued strong growth in service provider routers (GSe up 9% qoq and 18% yoy) as carriers are ramping capacity investments to meet accelerating traffic demand – a trend that we believe was strengthened by the accelerated shift to over-the-top video in 4Q." Goldman has a Buy on the shares, with a $44 price target.
Wedbush sees near-term momentum with service providers as "they look to more aggressively invest in their network infrastructure to handle increases in data traffic." Wedbush believes that "positive near-term trends will outweigh concerns about global growth, pricing and competition but [they] remain concerned that competition in the enterprise market, as evidenced by discounting, which [they] think could pose some risk to the company’s longer-term revenue and operating model targets."
Wedbush is looking for EPS of $0.38 and revs of $1.13 billion. They have a Neutral on the shares, with a $34 price target.
Wells Fargo sees a report toward the high-end of guidance, and a Q111 outlook including "qualitative commentary regarding the ramp of new products and end market demand to drive consensus estimates higher post the call." Their checks affirms this conclusion. They are looking for EPS of $0.37.
Wells is modeling gross margins of 67.5% and operating margins of 25%, compared to guidance of 66% - 68% and 24.5%, respectively. Wells has an Outperform on the shares with a valuation range of $41 to $43.
Miller, Tabak, + Co. is surprised that no one is talking about Core Routers. Though the Service Provider Core Router market has traditionally been Juniper's bread-and-butter, Miller Tabak thinks that this could change.
On the market, Miller comments, "We have been looking hard at the Core Router market as a result of comments from Ciena. They noted the last remaining component to enable deployment of 100G in the Service Provider footprint is actually the availability of cost effective and volume available Cisco and Juniper 100G router blades. For Service Providers the benefits of deploying 100G OTN Optical Transport in the Metro and Long Haul infrastructure is significantly enhanced by the availability of 100G downlink blades from the Core routers." Replacement will come in three waves, with the initial demand trickling in, followed by replacement of line cards in the installed base, and then the replacement of old router chassis.
Miller Tabak's looking for Q410 EPS of $0.37.
Juniper Networks is expected to release their Q410 earnings on Tuesday, January 25, 2011, at approximately 4:00pm EST. Stay tuned to StreetInsider.com's EPS Insider section to see our analysis of the highly-anticipated quarterly results withi0 n seconds of their release.
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