Earnings Preview: Juniper Networks

Juniper Networks (JNPR) is expected to report Q2 earnings after market close Thursday, July 24, with a conference call scheduled for 4:45 p.m. ET.

Guidance

The consensus estimate is 27c for EPS and $852.29M for revenue, according to First Call.

Analyst Views

Deutsche Bank expects slightly better than in-line revenue. They are estimating $850M, at the upper-end to management's guidance to $845M to $850M. Deutsche's EPS estimate is 27c, versus guidance of 26c to 27c. For 2Q08, Deutsche has modeled gross margin of 68.4%, roughly in-line with Q1 levels, as product mix and fixed cost leverage will likely result in the gross margin being slightly ahead of its expectation. Deutsche believes that secular drivers in the core routing business aided by carrier specific strength at Nippon Telephone & Telegraph (NTT) will more than offset unsurprising weakness in the security business. The firm also expects strong growth in both data center and carrier Ethernet products.

Friedman Billings expects an in-line quarter with "good enough" guidance. It has been reasonably constructive on the shares and thinks management will provide a decent outlook on telco spending trends, which are approximately 75% of Juniper's total sales. RBC Capital is looking for Juniper to slightly beat the quarter and maintain its full year outlook. The firm says that the router segment remains solid and it is looking for a strong showing from the MX series in particular.

In terms of guidance, Juniper may reiterate its full-year plan of $3.4B to $3.55B. RBC remains at $3.5B versus the consensus of $3.49B. Full year EPS guidance may also be reiterated at $1.10 to $1.13, according to RBC Capital.

Comments

[Wez]

I'm expecting they miss. Tech spending is weakening along with everything else.

[Nidhi]

now with a new CEO, who came from Microsoft ..