Is Juniper A Buy With The New Network Automation Tool?

| About: Juniper Networks (JNPR)

Juniper (NYSE:JNPR) has made an impact on the data center sector by successfully developing one of the most effective network automation and orchestration tools that the world has seen. The network automation device launched by Juniper contains the solutions that have been praised as the most flexible of their kind to date. It marks an important achievement for a tech giant that has long been regarded as one of the leaders in the industry. The following months could witness a rise in the production of the solution. This could lead to a 2% improvement on the stock.

The holistic set of the network product can be used by the enterprises to increase their business agility through a system automation. It enables a network operator to maneuver the new switches without a manual intervention. The initiative is an improvement over the products of the competition. The solution is also an innovation that indicates Juniper is dedicated to solving the crucial problems of the customer population. The Juniper data center product addresses the needs of the enterprising and the cloud networking storage clients.

The company worked with Puppet Labs and Cloudscaling in the development of the product. Consequently, these two companies are at the forefront of the organizations that want to purchase and use the product. Juniper will be providing them with a solution that enables a seamless delivery in an enterprise cloud and a virtualized environment. If companies such as these are ready to become the buyers, I feel it is an excellent confirmation of the quality of Juniper's product. The automation product is available for any investor who wants to carry out a thorough research on the stock. But it must be said that the solution is one of the numerous innovative products from Juniper that makes the company a leading entity in the industry.


However, an investor needs to be aware of a few truths. Though the product marks an important milestone in the history of Juniper, it may not be a dominant one for a long time. Juniper's competitors will begin developing a more effective and a better network automation and orchestration product within a few weeks. Many knowledgeable investors will inform you that the method to develop Juniper's product does not involve a complicated procedure. It would not take years, I believe, before Juniper is overshadowed by a rival with a better solution.

Cisco (NASDAQ:CSCO) is addressing a problem faced by the enterprises who want to control the energy usage in a data center. This is because a data center's energy usage is becoming a crucial factor in the effective operation of a cloud network. The cost of an energy usage can escalate if it is not monitored and managed. Cisco has acquired a company to create the products to control the energy usage in a data center. With the acquisition, it will now have the solutions that will reduce the energy cost and its consumption across an entire organization. However, with a price to sales ratio of 2.22, compared to 2.75 for Cisco, and an EPS of 0.50, compared to 1.80 for Cisco, Juniper is not doing badly.

The products could cause a serious problem to Hewlett Packard (NYSE:HPQ). However, this major player in the data center sector has responded to the challenge by recently unveiling its own data center automation and orchestration product. Hewlett Packard is traditionally an active player in the sector. It is taking a brilliant step by getting involved in the improvement of its solutions. The company is optimistic about its chances of making its initiative a success. But with an EPS of -6.85 and a price to sales of 0.42, Hewlett Packard is not better than Juniper.

Alcatel-Lucent (ALU) is another of Juniper's competitors. Recently, it announced that it had developed a software suite incubated by an internal group acting as a separate company. This is a milestone in the industry, as it appears to embrace an open standard at a greater depth to the competing offerings from Cisco and Ericsson. With an EPS of -1.21 and a price to sales of 0.20, Alcatel-Lucent is also not better than Juniper.


As tech stocks go, Juniper is one of the most important. The company is a leader in the data center sector. An investor should look for its qualities in any organization. Juniper has marked itself out as an innovative company with the network automation and orchestration product. It is a bit problematic to predict the direction of a stock. But I believe Juniper deserves to be given an attention. I think its future is a bright one. The stock has the prospect of improving its price multiples.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.