Tech Trader Daily blog has some
analyst's comments following a meeting yesterday - these basically reiterate the "networking is back" theme I keep repeating. (as always take analysts' comments with a grain of salt, but with multiple takeaways being very similar, it seems to bode well for the space)
- RBC Capital’s Mark Sue raised his price target on the stock to $35 from $3, citing “further clarity in the company’s ability to improve operating margins.
- Sanjiv Wadhwani, of Stifel Nicolaus, upped his target on the stock to $41 from $30. He raised his 2008 EPS estimate to $1.14 from $1.10
- Samuel Wilson, of JMP Securities, raised his target to $38, from $31, and says he “came away feeling appreciably more positive about Juniper’s financial prospects over the next 18 months.” He says Juniper “is on positive product cycles in several areas and actively addressing its previous execution issues.” Wilson raised his 2008 EPS estimate to $1.10 from $1.03.
Juniper Networks is a 1.5% holding in the fund, which I'd like to add to, but the stock never pulls back save for the waterfall selling in mid August. Current consensus on 2008 is $1.08 with a range of $0.83 to $1.15. The $1.08 is up from $1.00 two months ago. At $35, Juniper is trading at forward PEs of 42x 2007 and 34x 2008. Still pricey, but most likely we will see these estimates revised upward over time. While a company like
Ciena (CIEN) is not a pure play competitor, I like
Ciena (CIEN) more from a valuation standpoint (30x 2007 and 23x 2008), although the 'lumpy' revenue of Ciena makes it more of a quarter to quarter risk in terms of pleasing the street. Ciena is the fund's largest holding.
Long Juniper Networks and Ciena in fund; no personal positions
