Wednesday, July 27, 2011

Today's Major Market Move - Juniper Networks (JNPR) Drops 20% in Today's Session

On a day when there was much carnage in the U.S equity markets, one company that was hit particularly hard was Juniper Networks (ticker: JNPR). Juniper announced results for its fiscal second quarter yesterday. They missed on both the top and bottom lines as well as guided lower for the next quarter. Bad news all around and the stock price responded by dropping 20% in one day. More from Bloomberg:
“Across the board there was no shortage of concerns and cautionary comments,” said Jason Ader, an analyst at William Blair & Co. in Boston, who rates the stock “outperform.” “It’s a fairly large deterioration in their business.”
Second-quarter profit excluding some costs was 31 cents a share, the Sunnyvale, California-based company said yesterday in a statement. Revenue rose 15 percent to $1.12 billion from $978.3 million a year earlier. Analysts on average had projected profit of 33 cents a share and sales of $1.15 billion, according to data compiled by Bloomberg.
Third-quarter revenue will be $1.07 billion to $1.12 billion, Juniper said. Profit excluding some items will be 26 cents to 30 cents a share. Analysts projected $1.22 billion in sales and 38 cents in profit.
The bad news spilled over to some other network device makers with Tellabs (ticker: TLAB) and JDS Uniphase (ticker: JDSU) dropping 9% and 8.1% respectively. All 3 stocks were the worst performers in the S&P 500 today.

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JNPR missed the previous quarter as well. On a GAAP basis, they came in at .24 EPS with .34 EPS expected. Here's a chart of expected EPS vs actual EPS with the time scale in calendar quarters:

The stock price is back to where it was at the beginning of 2008. The following is a chart of % growth of actual eps, estimated eps and stock price by calendar quarters:

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Click here for the current version of the above 2 charts.
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