The gang down on Wall St. thinks Juniper got left at the altar when Ericsson bought rival Redback. Juniper and Redback noth sell edge routing equipment for the internet. CIBC was so upset that they downgraded Juniper’s stock.
Of course, Redback’s market cap is about $2 billion, and Juniper’s is over $10 billion. Even in this day and age, that is a fairly big difference.
There was another good reason to pass up Juniper and that came out today. Juniper is going to take a $900 million charge for backdated options.
All is not lost. Motorola may still be interested in Juniper. Even though Alcatel and Lucent have merged, they might want to take on a third partner. Nortel could use some help as well.
The question for Juniper shareholders is whether they will get an 18% premium like the Redback shareholders got.
Redback’s stock has outperformed Juniper’s for almost the entire year. That maybe one sign.
The other key issue is whether Juniper can get the options issue behind it quickly, file past financials, and show the its is continuing to grow and improve operatin income. If not, the premium in any takeover may be very small indeed.
Douglas A. McIntyre can be reached at [email protected]. He does not own securities in companies that he writes about.
Sponsored: Want to Retire Early? Here’s a Great First Step
Want retirement to come a few years earlier than you’d planned? Or are you ready to retire now, but want an extra set of eyes on your finances?
Now you can speak with up to 3 financial experts in your area for FREE. By simply clicking here you can begin to match with financial professionals who can help you build your plan to retire early. And the best part? The first conversation with them is free.
Click here to match with up to 3 financial pros who would be excited to help you make financial decisions.
Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.