Juniper Networks, Inc. (NYSE:JNPR), the industry leader in network innovation, recently won a deal from global web hosting provider PEER 1. Juniper’s integrated routing, switching and security technology is being used in PEER 1’s U.K. data center.
Juniper Networks, Inc. (NYSE:JNPR)’s close rival, F5 Networks, Inc. (NASDAQ:FFIV), designs and sells application delivery controllers, which are hardware appliances used in data centers. The company’s products simplify the management of data centers and delivery of services across diverse resources.
Analysts at Deutsche Bank are encouraged by product wins at Juniper Networks, Inc. (NYSE:JNPR) and have lifted the price target for the stock to $22.50. F5 Networks, Inc. (NASDAQ:FFIV) is also a stock to buy, according to Deutsche Bank, which has a $116 price target on the stock. In this post, I will focus on the growth catalysts for these two stocks.
Juniper’s growth catalysts
1. Product wins
PEER 1 Deal: Juniper’s networking solution will help PEER 1 lower server downtime in its flagship green data center in Portsmouth by approximately 33% compared with existing systems. This new facility offers Power Usage Efficiency (PUE) scores that are better than the industry standard.
CERNET Deal: Juniper recently announced that it has provided the China Education and Research Network (CERNET) with its advanced core routing solutions, the T4000 routers. Financial terms of the deal were kept confidential.
The Chinese government and the Chinese Ministry of Education jointly set up CERNET, which is a nationwide education and research computer network. It interconnects a number of Chinese Universities, educational institutes and research centers and is dedicated to support the country’s higher-education institutions. With Juniper’s T4000 routers, CERNET is now delivering ultra-fast broadband services to educational institutions and is helping the government to achieve the objectives of its education Project 211, which was initiated in 1995.
2. Software launches
In February, Juniper Networks, Inc. (NYSE:JNPR) unveiled its new software and services enabling mobile service providers to realize immediate benefits while laying the foundation to build software-defined networks, or SDNs. By deploying Juniper Networks’ new services provisioning application, mobile infrastructure application and virtualized services engine, customers can achieve elastic capacity and increased service velocity, while lowering overall operating expenses, or OPEX.
Based on use cases and data from ACG Research, customers may realize up to a 65% reduction in OPEX and up to a 54% reduction in total cost of ownership.
Juniper Networks, Inc. (NYSE:JNPR) also unveiled its new security line cards in February for its market-leading SRX5600 and 5800 Series Services Gateways. The solutions significantly improve performance and reliability for LTE mobile network operators. The new SRX Series line cards are the industry’s only high-end security solutions that can provide mobile operators with zero-downtime performance upgrades and scale to accommodate the exponential growth of network throughput.
F5 Networks’ growth catalysts
1. Growing Internet traffic
Global IP traffic has increased eightfold over the past five years and is estimated to be growing at a CAGR of 29% through 2016. A growing adoption of advanced video communications in the enterprise segment will likely fuel growth in enterprise traffic. Enterprise Internet traffic is expected to grow at an annual rate of 18%.