Juniper is a company that has amazed us with their ability to execute in a hyper-competitive market.
However lately there are bits of data coming in that suggest they are facing some fresh headwinds.Â While they appear okay on the enterprise front the carrier business could be more punk.Â Cisco continues to execute very well in the carrier area and 2nd tier vendors like Nortel (NT) are even winning some business in place of JNPR.
The other major concern we have on JNPR is high valuation.Â At 5x sales and 30x earnings we find the stock at least 20% overvalued as we go into a period of what we expect to be somewhat soft conditions.
We prefer other names like Corning (GLW) on the networking side and Research in Motion (RIMM) on Mobile Internet.
[R2Capital is short shares of JNPR and long shares of GLW and RIMM.]