After hitting a one-year low of $19.86 last April, the stock hit a one-year high of $37.95 in October. This morning, JNPR opened at $24.30. So far today the stock has hit a low of $23.69 and a high of $24.39. As of 12:40, JNPR is trading at $24.39, up 1 cent (0.04%). The chart for JNPR looks neutral and improving, while S&P gives the stock a neutral 3 STARS (out of 5) hold rating.
For a bearish hedged play on this stock, I would consider a July bear-call credit spread above the $31 range. A bear-call credit spread is an options position that combines the purchase and sale of call options to hedge risk in case the stock doesn't do what you think but still leverage nice returns. For this particular trade, we will make an 8.1% return in 3 and a half months as long as JNPR is below $31 at July expiration. Juniper would have to rise by more than 27% before we would start to lose money. Learn more about this type of trade here.
JNPR hasn't been above $31 since January and has shown resistance around $26 recently. This trade could be risky if the company's earnings (due out on 4/24) are a positive surprise, but even if that happens, this position could be protected by resistance JNPR might find at its 200 day moving average, which is currently around $31.
DISCLOSURE: Mr. Archer owns and/or controls diversified portfolios of long and short stock and option positions that may include holdings in companies he writes about. At publication time, Brent neither owns nor controls positions in JNPR.
MOST NOTEWORTHY: Cisco Systems, NYSE Euronext, Nasdaq and Cognicase were today's noteworthy initiations:
Friedman Billings believes Cisco Systems (NASDAQ: CSCO) is well-positioned to take advantage of "Business 2.0" applications and to gain share in a slower economic environment. The firm initiated shares with an Outperform rating and $31 target.
NYSE Euronext (NYSE: NYX) and Nasdaq (NASDAQ: NDAQ) were assumed with a Neutral rating and $72 target and $44 target, respectively, at UBS. The firm cited increasing competition and moderating volumes.
Deutsche Bank believes Cognicase (COGI) is one of the few carriers offering high-capacity commercial Internet access to enterprise customers at a discount to nearly all of its competitors. Shares were initiated with a Buy rating and $23 target.
OTHER INITIATIONS:
China Housing (OTCBB: CHLN) was initiated at Merriman with a Buy rating.
Goldman started Juniper (NASDAQ: JNPR) with a Market Perform rating and $27 target.
Suntrust initiated hhgregg (NYSE: HGG) with a Buy rating and $16 target.
MOST NOTEWORTHY: Motorola, California Pizza, and Seagate were today's noteworthy downgrades:
Banc of America downgraded shares of Motorola (NYSE: MOT) to Neutral from Buy, despite believing the split into two businesses could ultimately unlock value, as they see few catalysts over the next year to lift shares. Banc of America also sees risk to Q1 earnings and lowered their target to $11 from $15.
Friedman Billings lowered California Pizza Kitchen (NASDAQ: CPKI) to Market Perform from Outperform citing sluggish trends in its core markets.
Seagate (NYSE: STX) was cut to Neutral from Outperform at Baird, citing weakening industry conditions throughout the month of March.
OTHER DOWNGRADES:
Goldman lowered the Communications Tech sector to Neutral from Attractive, and also downgraded Juniper Networks (NASDAQ: JNPR) and Starent Networks (NASDAQ: STAR) to Neutral from Buy, and Aruba Networks (NASDAQ: ARUN) to Sell from Neutral.
Juniper Networks, Inc. (NASDAQ: JNPR) shares are trading higher today after RBC Capital Markets upgraded the stock to Sector Perform from Outperform as noted by our own Eric Buscemi. We always think what kind of trade might make sense in light of the news. If you think that the company's stock won't fall by too much in the coming months, then now could be a good time to look at a bullish hedged trade on JNPR.
After hitting a one-year low of $17.21 in March, the stock hit a one-year high of $37.95 in October. JNPR opened this morning at $26.91. So far today the stock has hit a low of $26.54 and a high of $27.36. As of 11:20, JNPR is trading at $27.16, up 97 cents (3.7%). The chart for JNPR looks bearish but improving slightly, while S&P gives the stock a neutral 3 STARS (out of 5) hold rating.
For a bullish hedged play on this stock, I would consider an April bull-put credit spread below the $22.50 range. A bull-put credit spread is an options position that combines the purchase and sale of put options to hedge risk in case the stock doesn't do what you think but still leverage nice returns. For this particular trade will make an 8.7% return in just two months as long as JNPR is above $22.50 at April expiration. Juniper would have to fall by more than 17% before we would start to lose money.
JNPR hasn't been below $22.50 since last May and has shown support around $25 recently. This trade could be risky if JNPR continues its recent downward slide, but even if that happens, this position could be protected by the support the stock has found just below $25 over the past month. Brent Archer is an options analyst and writer at Investors Observer. At publication time, Brent neither owns nor controls positions in JNPR.
MOST NOTEWORTHY: Genentech, ESS Technology and SemGroup Energy were today's noteworthy upgrades:
Rodman & Renshaw upgraded Genentech (NYSE: DNA) to Outperform from Market Perform citing the FDA's approval of Avastin in mBC.
Jefferies raised ESS Technology (NASDAQ: ESST) to Hold from Underperform to reflect the offer from Imperium Partners.
Citigroup upgraded shares of SemGroup Energy (NASDAQ: SGLP) to Buy from Hold on valuation, as they believe the significant accretion expected from the partnership's recent asphalt terminal acquisition is not priced into the stock.
OTHER UPGRADES:
Yum! Brands (NYSE: YUM) was raised to Buy from Neutral at UBS.
RBC Capital upgraded Juniper (NASDAQ: JNPR) to Outperform from Sector Perform.
Goldman raised its rating on BJ Services (NYSE: BJS) to Neutral from Sell.
Microsoft's (NASDAQ: MSFT) business division is one of its most profitable operations. Stephen Elop, an executive at network equipment company Juniper (NASDAQ: JNPR), will come to Redmond to head the part of the company that produces Office software applications. Jeff Raikes, who runs the business now, has been at the company since 1981.
It would be easy to assume that Mr. Raikes has made hundreds of millions of dollars at Microsoft, and would simply like to take his cash and have a little rest. But, as The Wall Street Journal points out, "a host of new competitors try to pick away at Office with Internet services." That list of competitors is lead by Google (NASDAQ: GOOG).
Microsoft has demonstrated through recent M&A activity that it is willing to increase its revenue beyond its traditional software business in areas such as search and internet advertising. But for the next several years the company's cash flow is going to come from its traditional products like Windows and Office. These now operate using the processing power and storage of the computers where they sit. Google is putting products into the market that operate on the PC but use the company's servers to do much of the work.
Raikes may be leaving because you can't teach an old dog new tricks. With Google coming after it, Microsoft needs to hope that it can teach its new dogs new tricks.
Douglas A. McIntyre is an editor at 247wallst.com.
Chevron Corp. (NYSE: CVX) said on Thursday it expects to earn a bigger profit in the fourth quarter than it did in the third because of higher energy prices.
FedEx Corp. (NYSE: FDX) said Thursday it will keep relying on contract drivers for its ground delivery division despite a challenge by the Internal Revenue Service, which assessed tax penalties and interest of $319 million.
Notable analyst calls this morning from Briefing.com:
Continental Airlines (NYSE: CAL), which already soared over 23% on airline merger rumors, was upgraded by Bear Stearns from Peer Perform to Outperform.
Dell (NYSE: DELL) was upgraded by JP Morgan from Neutral to Overweight (really?). Shares are gaining 1.2% in premarket trading.
Honeywell (NYSE: HON) was upgraded by JP Morgan from Underweight to Neutral.
Nokia (NYSE: NOK) was upgraded by RBC Capital Markets from Sector Perform to Outperform. Stock declining 1.5% in premarket trading.
Juniper Networks Inc. (NASDAQ: JNPR) is losing its chief operating officer to Microsoft. Shares are down 7.9% in premarket trading (8:03 a.m.) after two downgrades from JP Morgan and JMP Securities from Overweight to Neutral and from Market Outperform to Market Perform respectively.
Salesforce.com (NYSE: CRM) provides business clients with on-demand customer relationship management services. Its hosted applications offer a rapidly deployable alternative to buying and maintaining enterprise software. Subscribers use the firm's suite of nearly 600 programs to systematically record business data, manage customer accounts, track sales leads, evaluate marketing campaigns and provide post-sale services. The company's applications are offered in fourteen languages and can be accessed from PCs, cellular phones and personal digital assistants. Clients include Juniper Networks (NASDAQ: JNPR), Staples (NASDAQ: SPLS) and Time Warner (NYSE: TWX).
The company pleased investors last month, when it reported Q3 EPS of 5 cents and revenues of $192.8 million. Analysts had been looking for 3 cents and $190.6 million. The revenue figure pushed this year's nine-month sales above last year's twelve-month total. Management also predicted in-line earnings for Q4 and better than expected profits for the full year.
Juniper Networks, Inc. (NASDAQ: JNPR) shares are trading higher this morning as tech stocks are rebounding from recent losses. Some analysts felt the industry had a pull-back coming simply because those stocks had been safe havens throughout much of the financial sector's woes. Today, positive movement by Microsoft (NASDAQ: MSFT), Cisco (NASDAQ: CSCO) and Oracle (NASDAQ: ORCL) indicates that the mini-correction could be through. If you think that the company won't fall by too much in the coming months, then now could be a good time to look at a bullish hedged trade on JNPR.
After hitting a one-year high of $37.95 in October, the stock has declined over the past month. JNPR opened this morning at $30.05. So far today the stock has hit a low of $29.78 and a high of $30.35. As of 11:05, JNPR is trading at $30.19, up $0.50 (1.7%). The chart for JNPR looks neutral and deteriorating, while S&P gives the stock a negative 2 STARS (out of 5) sell rating.
In just a few years, Riverbed Technology (NASDAQ: RVBD) has built a strong technology offering, which helps move large files -- such as Microsoft (NASDAQ: MSFT) PowerPoints, SAP (NYSE: SAP) data files and so on -- across networks at high speeds. In fact, last week I had a chance to meet the CEO, Jerry Kennelly, who was quite upbeat even though Riverbed's stock price was down about 28% to $34.61.
Although, based on the fiscal Q3 results, things seem fine. Revenues spiked 158% to $63.3 million and net income was $2.8 million, or $0.04 per share, which compares to a net loss of $3.1 million, or $0.16 per share in the same period a year ago. About $9.7 million of Q3's expenses came from stock option compensation.
Riverbed has continued its innovation. Back in August, the company launched its Steelhead Mobile product, which improves the performance of file downloads for laptops. Riverbed claims that about 41% of workers in the US are mobile, such as in remote offices, hotel rooms, coffee shops and so on.
Juniper Networks, Inc. (NASDAQ: JNPR) is sinking after the company's earnings release yesterday evening. JNPR reported a 46% jump in quarterly profit, but only beat EPS estimates by a penny, far less than what many optimistic investors, who drove the stock up 3.5% yesterday prior to the earnings release, had expected. A Morgan Keegan analyst cautioned that Q3 expenses grew too much, and there is some worry that the company's expenses aren't under sufficient control. If you think this stock won't be rising too far in the coming months, then it could be a good time to look at a bearish hedged play on JNPR.
The stock has climbed steadily over the past seven months, reaching a 52-week high of $37.95 earlier this month. This morning, JNPR opened at $35.17. So far today the stock has hit a low of $33.43 and a high of $35.17. As of 10:40, JNPR is trading at $33.95, down $3.19 (-8.6%). The chart for JNPR looks bullish but deteriorating, while S&P gives the stock a neutral 3 STARS (out of 5) hold rating.
For a bearish hedged play on this stock, I would consider a December bear-call credit spread above the $40 range. A bear-call credit spread is an options position that combines the purchase and sale of call options to hedge risk in case the stock doesn't do what you think but still leverage nice returns. For this particular trade, we will make an 8.7% return in two months as long as JNPR is below $40 at December expiration. Juniper would have to rise by more than 17% before we would start to lose money. Learn more about this type of trade here.
Wal-Mart (NYSE: WMT) is hosting its annual analyst meeting on October 23-24. Bear Stearns says: "Our WMT wishlist includes 1) reduce net square footage growth in the U.S. to 0%; 2) sell Asda; and 3) exit Japan." Goldman upgraded WMT to Buy from Neutral on 10/17/07. WMT November option implied volatility of 25 is above its 26-week average of 23 according to Track Data, suggesting slightly larger price risk.
Juniper (NASDAQ: JNPR), a provider of internet infrastructure solutions to internet service providers and other telecommunication services providers, will report third quarter EPS on 10/23. JNPR November option implied volatility of 53 is above its 26-week average of 40 according to Track Data, suggesting larger price risks.
Volatility Index S&P 500 Options-VIX is recently up 3.05 to 21.55.
Daily options Update is provided by Stock Specialist Paul Foster of theflyonthewall.com.
When it comes to protecting your firm's computer network, you want to do business with a security software company experienced at dealing with complex corporate systems. There is an outfit in Israel that knows those ropes. Among the thousands of businesses on its customer list are all of the Fortune 100 companies.
Check Point Software Technologies (NASDAQ: CHKP) provides security software used to protect corporate networks. Products verify remote users, control access, block viruses and allow firms to establish virtual private networks (VPN) for secure communications, bandwidth management and enhanced performance. Competitors include Cisco Systems (NASDAQ: CSCO), Juniper Networks (NASDAQ: JNPR) and Symantec Corporation (NASDAQ: SYMC).
The company received some good news last week, when Friedman Billings upgraded the shares from "market perform" to "outperform" and boosted its price target to $28. The broker noted that Check Point was starting to see a re-acceleration in business from its strengthened VPN/firewall product portfolio and believed the company was positioned to benefit from an anticipated surge in endpoint security spending over the next year.
Juniper Networks (NASDAQ: JNPR) option volatility Elevated at 43 into 9/6 investor meeting. JNPR, a provider of internet infrastructure solutions to internet service providers and other telecommunication services providers, is recently down .04 to $32.74. JNPR will host an investor gathering in Sunnyvale, CA. on 9/6. Bank of America-BAMO says, "We don't expect any update to JNPR's financial guidance, we do expect a positive tone highlighting new growth opportunities resulting from new products and carrier NGN builds." JNPR over all option implied volatility of 43 is above its 26-week average of 36, according to Track Data, suggesting larger price risks.
Motorola (NYSE: MOT) implied volatility Flat into 9/7 investor meeting. MOT is hosting an analyst day in New York on 9/7. BAMO says, "we expect management to discuss its business strategy and market trends, and to highlight a number of new handsets." MOT over all option implied volatility of 30 is near its 26-week average, according to Track Data, suggesting non-directional risk.
Daily options update is provided by Stock Specialist Paul Foster of theflyonthewall.com.
Juniper Networks, Inc. (NASADQ: JNPR) stock is relatively flat today after an analyst at Friedman, Billings, and Ramsey initiated coverage on the stock with a "Market Perform" rating, saying he expects modest growth for the company over the next few years. The analyst said profit forecasts by other analysts are realistic, but there is reason to be cautious on JNPR, since other vendors have noted increasing caution by customers. If you think this stock won't be rising too far in the coming months, then it could be a good time to look at a bearish hedged play on JNPR..gif){kind=logo}
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