Deutsche Bank Reveals Top Data Networking Picks for 2019

Juniper Networks

This solid technology stock has been on a long roller-coaster ride for investors over the past few years. Juniper Networks Inc. (NYSE: JNPR) is a provider of high-performance network infrastructure to service providers and enterprises.

Key products include IP-based routers for service provider core and edge networks, security solutions and high-end enterprise routing equipment. Juniper’s products support converged data, voice, video and wireless applications across extended networks.

The Deutsche Bank report noted this:

Our investment thesis continues to call for improving fundamentals and modest multiple expansion driven by new design wins and re-accelerating growth for the company’s Cloud, Enterprise and Carrier Switch Routing and Software solutions business, heading into fiscal year 2019.

Shareholders are paid a 2.59% dividend. The $32 Deutsche Bank price target compares with the consensus target of $28.20 and the most recent close at $27.77 a share.

Motorola Solutions

This stock has been on fire and Deutsche Bank feels more upside is possible. Motorola Solutions Inc. (NYSE: MSI) is a provider of communication infrastructure, devices, accessories, software and services. The company operates through two segments.

The Products segment has two product lines: Devices and Systems. The primary customers of the Products segment are government, public safety and first-responder agencies, municipalities and commercial and industrial customers operating private communications networks and manage a mobile workforce.

The Services segment provides a range of service offerings for government, public safety and commercial communication networks. This segment’s product lines include Integration services, Managed & Support services and Integrated Digital Enhanced Network.

The analyst noted this about the company’s prospects:

Investors are likely to see a line of sight into structurally improving mix and margins, plus attractive risk/reward at current levels. This is the core basis of our call for a modest rerating of the company’s multiple – from the “low to mid teens” to the “mid to high teens” over the next few years.

Fundamental positives in the story, in our view, are resilient demand trends in the core Public Safety Devices, Systems, and Managed Services business at US Fed, State and Local agencies, in particular. We continue to highlight Avigilon HD Video Surveillance and Software Command Control as multi-year growth drivers that are yet to be fully discounted in MSI’s trading multiple and in consensus estimates.

Shareholders receive a 1.77% dividend. The Deutsche Bank price objective is $140. The consensus target price is $136.95, and the stock closed on Tuesday at $121.89.

The technology revolution will only continue to grow as consumer and business demand for all Internet of Things and beyond continues to manifest. While very attractive now, these stocks are only suitable for accounts with a higher risk tolerance, as earnings or guidance misses can cause big volatility, and the market is still vulnerable to continued selling going forward.

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