Juniper Networks soars on analyst rating
Shares of high-flying Juniper Networks jump $45 after an analyst firm starts coverage of the network equipment firm with a "strong buy" rating.
Juniper's stock climbed 20 percent today, closing at $274.31 as more than 4 million shares exchanged hands. Since a 3-for-1 stock split in mid-January, the company's stock has more than doubled.
The strong increase today follows Wit Soundview's new coverage of Juniper, as the analyst firm rated the stock a "strong buy" with a 12-month price target of $350.
Juniper, which competes against networking giant Cisco Systems, is best known for its high-speed routers that send information along the Internet.
"The momentum behind this stock is surprising, but it clearly illustrates the importance of Internet protocol routing, and Juniper's market penetration of the core Internet infrastructure market," said analyst Michael Davies, of Gruntal & Co. Internet protocol is the standard used to send information along the Internet.
Juniper and other networking firms, from established players like Cisco and Nortel Networks to other upstarts like Sycamore Networks and Extreme Networks, have benefited from investors' obsession with everything related to the Internet.
In fact, shares of Redback Networks, Extreme, Cabletron Systems and 3Com reached 52-week highs today. Redback's stock increased $21.25 to $298.50. Extreme shot up $17.59 to $111.25, while Cabletron Systems inched up $5.19 to $49. 3Com's stock rose $18.94 to $98 as investors gear up for 3Com's spin off of its popular Palm Computing unit.
Juniper last month posted its first quarterly profit since going public last June. The upstart firm has sold much of its equipment to large service providers, such as MCI WorldCom's UUNet unit and British telecommunications firm Cable & Wireless.
"They're a great growth story and well-positioned. A lot of carriers are buying their equipment," said Argus Research analyst David Toung, who last month set a 12-month target price of $250 for Juniper's shares. "They have good products, and good profits."