The Zacks Analyst Blog Highlights: Juniper Networks, General Electric, Cisco Systems, Hewlett-Packard Company and Advance Auto Parts

News provided by

Nov 09, 2011, 09:30 ET

CHICAGO, Nov. 9, 2011 /PRNewswire/ -- Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include Juniper Networks Inc. (NYSE: JNPR), General Electric Co. (NYSE: GE), Cisco Systems Inc. (Nasdaq: CSCO), Hewlett-Packard Company (NYSE: HPQ) and Advance Auto Parts Inc. (NYSE: AAP).

(Logo: http://photos.prnewswire.com/prnh/20101027/ZIRLOGO)

Get the most recent insight from Zacks Equity Research with the free Profit from the Pros newsletter: http://at.zacks.com/?id=5513

Here are highlights from Tuesday's Analyst Blog:

Juniper & GE to Secure Defense Data

Juniper Networks Inc. (NYSE: JNPR) recently announced that it will be joining hands with one of the business units of technology company General Electric Co. (NYSE: GE), to jointly develop a series of highly scalable and secured networking and routing gadgets. These products would communicate data within the military or aerospace verticals with utmost security, in severe environments.

In this regard, the company has already announced a router –– RTR8GE –– at the premier international conference for military communications (MILCOM 2011). As a point of reference, MILCOM gives the defense industry the opportunity to promote communication technologies and services to commanders across all branches of the armed forces, the Department of Defense, the federal government and the heads of multi-national forces around the world.

The custom-made router will feature Juniper's flagship operating system Junos, which is regaining importance with customers. RTR8GE will also incorporate firewall, intrusion prevention and detection capabilities, and will include anti-tamper protection and information-assurance technologies, bearing in mind the sensitive nature of the data it is designed to transport.

The product will facilitate the task of secure direct data communication by military and aerospace personnel from any rugged environment such as a battle field.

The end product will be marketed and sold by GE Intelligent Platforms, which is a business unit of GE Home & Business Solutions. The unit designs, manufactures and supplies hardware and software products for industrial control and automation.

Earlier, Juniper's products have served the defense sector many times. But this time, the opportunity to combine with the ace tech solutions provider GE will enable Juniper to enrich its exposure in the military vertical.

We believe that with its growing experience as a service provider, Juniper will be competent to snap up a good number of defense deals, going forward.

Despite Juniper's strong product line-up, we are a bit cautious about its third quarter results, which missed the Zacks Consensus Estimate. Moreover, stiff competition from industry stalwarts such as Cisco Systems Inc. (Nasdaq: CSCO) and Hewlett-Packard Company (NYSE: HPQ), as well as Juniper's European exposure could weigh on the stock.

Juniper has a Zacks #4 Rank, implying a short-term Sell rating.

Earnings Preview: Advance Auto

Advance Auto Parts Inc. (NYSE: AAP) announced that it would release its results for the third quarter of 2011 after the market closes on November 09, 2011. Roanoke, Virginia-based Advance Auto realized earnings per share of $1.46 in the second quarter, higher than the Zacks Consensus Estimate of $1.39 per share.

In the upcoming quarter, the Zacks Consensus Estimate for Advance Auto is pegged at a profit of $1.19 per share, reflecting an annualized growth of 15.47%. The downside potential of the estimate, essentially a proxy for future earnings surprises, is 1.68%.

With respect to earnings surprises, the company outdid the Zacks Consensus Estimate in the trailing four quarters. This is reflected in the average earnings surprise of 4.44%. The company outdid the Zacks Consensus Estimate in three of the concerned quarters while the remaining one failed to beat the Estimate.

Estimate Revisions Trend

Earnings estimate for the third quarter of 2011 is currently pegged at a profit of $1.19 per share. The analysts are confident that the company will be able to improve sales and productivity with its current operational initiatives.

Agreement of Estimate Revisions

Out of the 16 analysts covering the stock, only one has upgraded the stock in the past 30 days. However, none of the analysts has downgraded it in the given period.

Magnitude of Estimate Revisions

Following the second quarter earnings release in August, third quarter earnings per share were projected at $1.18. However, in the past 60 days the estimate rose by a penny to $1.19 and has been maintained there since.

Our Take

Advance Auto has taken various initiatives to improve sales and productivity within its existing business. These initiatives include the ongoing development of merchandising programs driven by category management, enhanced store remodeling programs, nationwide advertising to build the AAP brand and the expansion of the commercial customer base.

Advance Auto has reviewed its business strategies to drive sales, lower costs and increase return on invested capital (ROIC). The company aims to improve its supply chain and vendor terms. Furthermore, it plans to open better-located stores and divest unprofitable stores. The company has achieved increased DIY and DIFM sales by improving availability of parts at its stores.

Meanwhile, Advance Auto has implemented an aggressive program to reduce the inventory of other less-profitable products, which in turn will free up cash to increase parts availability.

Thus, considering all these factors, the shares of Advance Auto maintain a Zacks #2 Rank, which translates into a short- term Buy rating (1 to 3 months).

Want more from Zacks Equity Research? Subscribe to the free Profit from the Pros newsletter: http://at.zacks.com/?id=5515.

About Zacks Equity Research

Zacks Equity Research provides the best of quantitative and qualitative analysis to help investors know what stocks to buy and which to sell for the long-term.

Continuous coverage is provided for a universe of 1,150 publicly traded stocks. Our analysts are organized by industry which gives them keen insights to developments that affect company profits and stock performance. Recommendations and target prices are six-month time horizons.

Zacks "Profit from the Pros" e-mail newsletter provides highlights of the latest analysis from Zacks Equity Research. Subscribe to this free newsletter today: http://at.zacks.com/?id=5517

About Zacks

Zacks.com is a property of Zacks Investment Research, Inc., which was formed in 1978 by Leon Zacks. As a PhD from MIT Len knew he could find patterns in stock market data that would lead to superior investment results. Amongst his many accomplishments was the formation of his proprietary stock picking system; the Zacks Rank, which continues to outperform the market by nearly a 3 to 1 margin. The best way to unlock the profitable stock recommendations and market insights of Zacks Investment Research is through our free daily email newsletter; Profit from the Pros. In short, it's your steady flow of Profitable ideas GUARANTEED to be worth your time! Register for your free subscription to Profit from the Pros at http://at.zacks.com/?id=5518.

Visit http://www.zacks.com/performance for information about the performance numbers displayed in this press release.

Join us on Facebook: http://www.facebook.com/home.php#/pages/Zacks-Investment-Research/57553657748?ref=ts

Disclaimer: Past performance does not guarantee future results. Investors should always research companies and securities before making any investments. Nothing herein should be construed as an offer or solicitation to buy or sell any security.

Media Contact
Zacks Investment Research
800-767-3771 ext. 9339
[email protected]
http://www.zacks.com

SOURCE Zacks Investment Research, Inc.