Juniper Networks’ stock rises as revenue beats Wall Street target
Computer network equipment maker Juniper Networks Inc. delivered solid third-quarter results today, posting earnings that matched Wall Street’s expectations and revenue that beat consensus.
The company reported a third-quarter profit before certain costs such as stock compensation of 43 cents per share on revenue of $1.14 billion. Wall Street had forecast earnings of 43 cents per share on slightly lower revenue of $1.12 billion. Juniper’s product and service revenues also beat analysts’ expectations.
Juniper Chief Executive Rami Rahim (pictured) said the company had seen solid demand from customers during the quarter that helped it drive a second consecutive quarter of positive order growth.
“While the global macro environment remains uncertain, the strategic importance of the global network has never been clearer and we remain confident regarding the long-term outlook for our business,” Rahim said in a statement.
That may be so, but Juniper, which sells products such as routers, switches, software-defined networking technology and network management software, can’t hide the fact it has had a disappointing year compared with some of its tech rivals. While most other technology firms have seen their stock rise amid a boost in sales due to the COVID-19 pandemic, Juniper’s stock is down 11% since the start of the year.
Analyst Holger Mueller of Constellation Research Inc. said Juniper did well considering the challenges it faces given the COVID-19 pandemic and deserves credit for delivering on expectations.
“The next quarters will be interesting as its existing investment plans will run out and Juniper will have to show it can create more revenue from new contracts,” Mueller said. “The next quarter will be key to see to see if Juniper can catch up in its service provider business and outgrow it with its cloud business.”
Juniper’s management will at least be encouraged by the small boost the company received today, with its stock rising 4% in after-hours trading, helped by fourth-quarter guidance that was in line with Wall Street’s expectations.
For the fourth quarter, Juniper said it’s expecting earnings of between 48 and 58 cents per share on revenue of $1.14 billion to $1.24 billion. Wall Street’s forecast of earnings of 53 cents per share on $1.19 billion in revenue sits squarely in the midpoint of those ranges.
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