Editor's note: As part of our partnership with PBS's Nightly Business Report, TheStreet's James Rogers will appear on NBR Tuesday (check local listings) to discuss 2011's top 3 networking stocks.

NEW YORK ( TheStreet) -- We're only a couple weeks into 2011, but tech firms Juniper ( JNPR) , Riverbed ( RVBD) and Cisco ( CSCO) are already emerging as the networking sector's front runners, say analysts.

Trends such as cloud computing, which delivers a host of services over the Internet, spell good news for companies that lay the networking foundations such as switches and routers.
Word on the Street

"If you believe in the cloud story and if you believe in Apple ( AAPL) moving its base to on-demand and hosting services, you have to buy into the growth of networking," Avi Cohen, an analyst at Avian Securities, told TheStreet.

Additionally, service providers are bolstering their networks to cope with the ongoing explosion in data-intensive traffic, which will further impact the companies in this space.

Both Riverbed and Juniper hit 52-week highs recently, while Cisco, despite its recent problems, remains the dominant player in networking.

Read on for more details on 2011's top networking stocks.

Juniper Networks

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Cisco ( CSCO) rival Juniper, which hit a new high last week, is getting plenty of love on Wall Street, with new networking products expected to drive growth in 2011.

"Juniper stands out," said Paul Mansky, an analyst at Canaccord Genuity, in an email to TheStreet, pointing to the recent performance of Juniper's EX switches, as well as the forthcoming launch of a new data center technology code-named Stratus. " These are all expected to contribute -- on top of that, they have demonstrated solid operating margin discipline."

During its recent third quarter, Juniper expanded its operating margin from 15.5% in the prior year's quarter to 19.3%, highlighting the firm's robust financial health. The networking specialist, which posted record third-quarter revenue, also grew its EX switch sales by more than 100% compared to the same period last year.

"Juniper is one of the companies that I would peg to watch in 2011," said Charles King, an analyst at tech research firm Pund-IT. "Ever since launching its new network initiative in October 2009, the company has been on a roll."

The new network strategy is focused on mobile Internet and cloud computing, a message that seems to be getting through. Juniper expects top line growth of more than 20% this fiscal year, and already counts Verizon ( VZ)as a customer.

The firm's performance has not gone unnoticed. Junipers shares have risen more than 45% over the last six months, so investors would be wise to wait for a pullback before jumping into this stock.

Riverbed

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Riverbed, which sells products for improving traffic over wide area networks (WANs), is seen as one of the best-positioned networking companies for 2011. Another Cisco competitor, the San Francisco-based firm has earned an impressive reputation since going public in 2006, and its WAN optimization offerings continue to drive strong sales.

Goldman Sachs, for example, recently raised its Riverbed price target, citing future growth potential, as well the company's attractiveness as a potential acquisition target. "Riverbed is the leading vendor of WAN optimization controllers," said Goldman analyst Simona Jankowski, in a recent note, explaining that the controllers are key for companies looking to consolidate their data centers and build cloud infrastructure.

There has even been talk that Riverbed could make an attractive acquisition target for longstanding partner Hewlett-Packard ( HPQ). With a forward price-to-earnings ratio of 49.7, Riverbed holds some potential for future earnings growth, even when compared to other up-and-coming networking stocks like F5 Networks ( FFIV).

"Riverbed remains our favorite way to play this space," said Michael Bauer, an analyst at FBR Capital Markets. "The company is poised to benefit from its technological leadership position, healthy demand trends and focused channel approach."

Like Juniper, Riverbed has clinched a major deal with Verizon and also sells its technology to Mitsubishi and satellite specialist Intelsat.

Canaccord Genuity's Mansky is another fan of Riverbed, despite its share price, which has risen more than 223% in the last 12 months to top $38. "Although Riverbed appears expensive, they are continuing to consolidate market share in the as-yet low penetration WAN optimization market," he explained in an email to TheStreet. The expected ramp-up of Riverbed's cloud technology over the next few quarters also bodes well for the company's performance in the second half of 2011, he added.

Riverbed is another stock where investors would be wise to wait for a cheaper entry point, though the company looks set to be a key beneficiary of the 2011 networking boom.

Cisco

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Cisco sent shockwaves through the tech sector with its less-than-stellar first-quarter results last year, but the company can't be written off. Despite struggling with spending "air-pockets" with its public sector customers, the networking behemoth still offers upside to investors.

Thanks largely to its recent results, Cisco's shares have plunged almost 16% over the last 12 months -- an attractive entry point into the stock, say some analysts.

"Cisco's challenges in calendar 2010 have been well documented," explained Canaccord Genuity's Mansky. "However, the company is undeniably a leading participant in what we expect to be one of the highest growth markets and geographies over the next several years."

Mansky explains that high-speed 40 and 100 Gigabit Ethernet technologies, seen as key for building clouds and wireless networks, are still in their relative infancy. AT&T ( T), however, has already worked with Cisco on a 100 Gigabit Ethernet project, which involved the networking giant's much-hyped CRS-3 router.

The San Jose, Calif.-based firm, which beefed up its service provider strategy at CES last week, is also ramping up its cloud efforts, partnering with BMC ( BMC), EMC ( EMC) and VMware ( VMW).

"Cisco is one to keep an eye on," said Pund-IT's King. "If Cisco (and its customers) continue to move towards cloud computing and as a service offerings, the company should be in the profitable thick of things."

Cisco stock, however, could be a long-term play as the company shakes off the problems of last year. Nonetheless, Canaccord's Mansky adds that Cisco is trading at earnings multiples similar to that of tech bellwether IBM ( IBM). "There appears to be virtually no risk to the multiple," he said.

--Written by James Rogers in New York.

>To see these stocks in action, visit the 3 Top Networking Stocks portfolio on Stockpickr.

>To follow the writer on Twitter, go to http://twitter.com/jamesjrogers.

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