Juniper Networks (JNPR) Stock Falls Despite Earnings Beat

NEW YORK (TheStreet) -- Juniper Networks  (JNPR) fell Wednesday despite the network equipment manufacturer's first-quarter results that surpassed analysts' expectations.

The company reported earnings per share of 29 cents, in line with analysts' estimates. Revenue rose 10.47% year over year to $1.17 billion, which beat the $1.15 billion estimate from analysts polled by Thomson Reuters

Juniper also issued earnings guidance of 36 cents to 39 cents a share for the second quarter, which surpassed the consensus estimate of 36 cents a share. The company also expects revenue in the range of $1.2 billion to $1.23 billion, while analysts anticipate $1.21 billion.

Wells Fargo also contends Juniper's multiple could expand further if the company continues to move toward meeting its savings target. Furthermore, Wells Fargo believes that the company's second-quarter guidance is conservative. The firm maintains its "outperform" rating on the stock.

Despite all this, the stock fell 4.5% to $24.73 at 2:36 p.m. on Wednesday. 

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Separately, TheStreet Ratings team rates JUNIPER NETWORKS INC as a "buy" with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:

"We rate JUNIPER NETWORKS INC (JNPR) a BUY. This is driven by a few notable strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, solid stock price performance, impressive record of earnings per share growth and compelling growth in net income. Although no company is perfect, currently we do not see any significant weaknesses which are likely to detract from the generally positive outlook."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • The revenue growth came in higher than the industry average of 1.1%. Since the same quarter one year prior, revenues rose by 11.6%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • Although JNPR's debt-to-equity ratio of 0.14 is very low, it is currently higher than that of the industry average. To add to this, JNPR has a quick ratio of 2.38, which demonstrates the ability of the company to cover short-term liquidity needs.
  • Powered by its strong earnings growth of 57.89% and other important driving factors, this stock has surged by 38.09% over the past year, outperforming the rise in the S&P 500 Index during the same period. Turning to the future, naturally, any stock can fall in a major bear market. However, in almost any other environment, the stock should continue to move higher despite the fact that it has already enjoyed nice gains in the past year.
  • JUNIPER NETWORKS INC reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, JUNIPER NETWORKS INC increased its bottom line by earning $0.86 versus $0.36 in the prior year. This year, the market expects an improvement in earnings ($1.56 versus $0.86).
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Communications Equipment industry. The net income increased by 58.6% when compared to the same quarter one year prior, rising from $95.70 million to $151.80 million.
  • You can view the full analysis from the report here: JNPR Ratings Report

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Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

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