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How Is Juniper Increasing Shareholder Value?

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Share repurchases and dividend yield

As you can see in the graph below, Juniper Networks (JNPR) repurchased shares worth $93 million and paid $38 million in dividends in 4Q15. Juniper’s CFO (chief financial officer), Robyn Denholm, stated, “I’m especially pleased that for the quarter, we delivered strong year-over-year and sequential non-GAAP operating margin and earnings per share expansion. This reflects our continued good execution focused on revenue growth and effective management of our cost structure.”

Since 1Q14, Juniper has returned approximately $3.6 billion of capital to shareholders against its commitment to return $4.1 billion by the end of 2016.

In 4Q15, cash flow from operations stood at $117 million, which was lower than 4Q14 due to working capital requirements. Capital expenditures for 4Q15 were $55 million.

Juniper pays $0.10 per quarter, or $0.40 for the year, as dividends, a 1.8% yield. In comparison, peer companies Cisco Systems (CSCO), Harris (HRS), and Motorola Solutions (MSI) had dividend yields of 3.9%, 2.6%, and 2.3%, respectively, as of December 2015.

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Analyst recommendations

Of the 36 analysts covering Juniper Networks stock, 12 have given it a “buy” recommendation, three have given it a “sell” recommendation, and 21 have issued “hold” recommendations. The analyst stock price target for the company is $27.50, with a median target estimate of $28. JNPR is trading at a discount of 9.1% to median estimates.

Juniper accounts for 4.3% of the iShares North American Tech-Multimedia Networking ETF (IGN).

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