Juniper Networks Analyst Reassures Investors About Hewlett Packard Acquisition

Earlier this year, Juniper Networks, Inc. JNPR had received a deal to be acquired by Hewlett Packard Enterprise Co HPE.

The definitive agreement inked by the company to be acquired by HPE is likely to go through as planned, according to Argus Research.

The Juniper Networks Analyst: Jim Kelleher upgraded the rating on Juniper Networks from Hold to Buy, with a price target of $40.

The Juniper Networks Thesis: The all-cash transaction represents an equity value of about $14 billion and is expected to close in late 2024 or early 2025, Kelleher said in the upgrade note.

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"The gap between the current JNPR price and the acquisition price is 13%, indicating a bit of uncertainty among investors that this deal will close on current terms," the analyst wrote. The stock has declined by 3% over the past three months, underperforming the 6% gain for the S&P 500, he added.

"Over the past year, they have also underperformed the S&P 500, with a gain of 13% compared to the index's 26% gain, and the shares have underperformed over the past five years," Kelleher stated. While HPE's deal represents high multiples, "we see Juniper as a good long-term strategic fit with HPEs' Intelligent Edge business and regard the purchase price as fair," he added.

JNPR Price Action: Shares of Juniper Networks were flat at $35.50 at the time of publication on Tuesday.

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