Analyst Note| Mark Cash |
No-moat Juniper Networks finished the second quarter with its top line exceeding our estimates and above the midpoint of management’s prior guidance. The company’s revenue grew 8% year over year, and its adjusted earnings per share clocked in at $0.43. Management cited a strong demand pipeline, with the firm witnessing record product orders during the second quarter, with strength seen across products and geographies. At the same time, however, supply chain constraints led to gross margin pressure, with supply chain challenges expected to persist through the year. With that in mind, we maintain our fair value estimate of $23. With shares trading at $26, down 5% during after-hours trading, we recommend investors wait for a greater pullback before committing new capital to the no-moat name.