Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Contrarian Investing -- Ignore unavailable to you. Want to Upgrade?

To: pcyhuang who wrote (2320)	7/27/2008 12:25:45 AM
From: pcyhuang	Respond to of 4080

re: JNPR Bloomberg reports: Juniper Networks climbed 18 percent to $26.57 for the biggest gain in the S&P 500 after boosting sales and profit estimates on rising orders from phone companies. The company reported a 40 percent jump in profit and said third-quarter revenue will be $925 million to $935 million. Analysts on average projected $887.1 million. Profit, excluding stock-based compensation costs, will be 29 cents to 30 cents share. Analysts predicted 29 cents. Souce: bloomberg.com Cheers,

To: pcyhuang who wrote (2320)	7/27/2008 11:00:25 AM
From: bruwin	Respond to of 4080

JNPR Good to see some Financial Statement data appearing alongside a chart. I must add, however, that it is not JNPR’s latest Quarterly results. What we see are JNPR’s Q1 results for March 2008. Their Q2 numbers for June 2008 came out on the 24 July ’08. It was on the following day that JNPR’s price spiked upwards on higher than normal volume. So one can probably assume that the catalyst was the contents of its Q2. Below are the matching numbers, excluding Cash Flow, from their Q2 results :- INCOME STATEMENT Total Revenue : 879.0 Gross Profit : 589.8 Operating Income : 160.5 Net Income : 120.4 BALANCE SHEET Total Current Assets : 2943.8 Total Assets : 7260.0 Total Current Liabilities : 1028.1 Total Liabilities : 1254.7 Total Equities : 6005.3 Looking at JNPR’s past results I wouldn’t have thought they’d warrant such a jump in price. There’s been an increase in Revenue of about 7% in the last Quarter, but that’s down from the 10% that was achieved 6 months ago. We see Bloomberg reporting that JNPR management are predicting $925mil.to $935mil. in their Q3. Well, the average of $930mil.is less than 6% up on their Q2, so they’re going slightly backwards. JNPR does have a good Operating Margin in excess of 20%, but its Return on Capital is about 10%, which is not exceptional. However, if we put JNPR’s EPS numbers for the past 24 months in four 6 monthly intervals we see a fairly linear increase. And if we project that trend forward by 6 months we could see an EPS of 48c. If we add that to the previous 6 month’s EPS of 42c we get a 12 month EPS of 90c. Just prior to JNPR’s Q2 results, the company was running at a P/E of about 30, and its price prior to the results was about $22.50. If it maintained that ratio for the next 6 months then we could see a price of 30 x 90c = $27. That is about where its price is at present. If those who have been recently buying JNPR see a more optimistic P/E of, say, 35 then its price could hit 35 x 90c = $31.50, which is 40% up on the $22.50. Personally I’d say a P/E of 35 is high for the current market. Apart from that, it will be interesting to see where JNPR’s price ends up, and for what reason(s).