What Plans Does Juniper Have for Its 2016?



Focus on product innovation

In 2016, Juniper Networks (JNPR) plans to accelerate its existing strategy by capturing inflection points in the industry. To achieve this, the company will focus on product innovation, partnerships, and acquisitions that complement its R&D (research and development) strategy.

Over the last few years, Juniper has tried to diversify its business. Its goal is for each of its segments to be less susceptible to macroeconomic cyclicality in terms of market verticals and technology. This has ensured healthy YoY (year-over-year) growth for Juniper in the last few quarters.

According to Juniper, Nokia (NOK) accounted for $190 million in revenues, while Europe’s (EFA) Ericsson (ERIC) accounted for $100 million in revenues in the last quarter.

The product cycle for Juniper has also become stronger.

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Juniper is optimistic about the cloud trend

Juniper Networks’ CEO Rami Rahim said, “It is now more evident than ever that everything is shifting to the cloud. Enterprise IT [information technology] is moving apps and data to public and hybrid clouds. Service providers are building out a distributed telco cloud to drive down operational cost, increase agility and better serve their customers.”

The cloud has required new network infrastructure builds and upgrades across area networks, data centers, and branch offices. Juniper aims to help companies in their transitions to cloud architectures. The company hopes to lead in the software solutions space, which simplifies network operations, allowing customers across verticals to deliver real value over networks.

As shown in the above chart, Juniper has underperformed the S&P 500 since 2010. It will be interesting to observe Juniper’s performance in 2016 to see if the company can overcome a challenging macroeconomic environment.

Juniper accounts for 4.3% of the iShares North American Tech-Multimedia Networking ETF (IGN). The other top holdings of this ETF include Cisco Systems (CSCO) and Harris (HRS), which constitute 8.6% and 9.1% of IGN, respectively.


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