Competition not working for Juniper Networks? – JNPR, CSCO, GS & ALU
Northern, WI 03/20/2013 (tradewatchmedia) – After being downgraded by a Goldman Sachs Group, Inc (NYSE:GS) down by 2.05% to close at $148.84 analyst, Juniper Networks, Inc (NYSE:JNPR) down by 5.29% to close at $19.14 plummeted the most in five months. The reason that had been cited for the downgrade was rising competition from Cisco Systems, Inc (NASDAQ:CSCO) down by 0.69% to close at $21.52 and Alcatel Lucent SA (NYSE:ALU). The stocks of the No 2 networking gear-maker have already fallen by 12 percent over the last one year and it slid by 5.3 percent after this news. The routers market is seeing a lot of competition with Alcatel Lucent SA (NYSE:ALU) steady at $1.47 entering the scene. Already in the running were Cisco Systems, Inc (NASDAQ:CSCO)’s new Nexus 6000 switches and an increase in demand for security walls from Palo Alto Networks Inc (NYSE:PANW) down by 0.23% to close at $55.98. Routers are Juniper Networks, Inc (NYSE:JNPR)’s core business.
Sustainability in question
In a research note, Goldman analyst Simona Jankowski wrote that that all these companies were threatening Junipers’ position in the market and cut the Juniper stock to neutral, taking its target price from $21 to $17. She wrote that they doubt Junipers ability to sustain itself in a market that is seeing increased competition and one which is very volatile as well. The company had gone through changes such as a switch to a largely software-oriented model, a spate of acquisitions which will impact the balance sheet and a senior management turnover that has been more than the average over the last three years.
Juniper Networks, Inc (NYSE:JNPR) is primarily involved in the sales of networking equipment and its customers are telecommunication service providers whose capital spending has been increasingly inconsistent. Janowski wrote that there is a distinct possibility that the spending on core internet routers will plateau.
Tagged Alcatel Lucent SA (NYSE:ALU), Cisco Systems Inc (NASDAQ:CSCO), Goldman Sachs Group Inc. (NYSE:GS), Juniper Networks Inc (NYSE:JNPR), NASDAQ:CSCO, NYSE:ALU, NYSE:GS, NYSE:JNPR, NYSE:PANW, Palo Alto Networks Inc (NYSE:PANW)