Intrinsic value of Juniper Networks - JNPR

Previous Close

$27.16

  Intrinsic Value

$68.24

stock screener

  Rating & Target

str. buy

+151%

  Value-price divergence*

+31%

Previous close

$27.16

 
Intrinsic value

$68.24

 
Up/down potential

+151%

 
Rating

str. buy

 
Value-price divergence*

+31%

*Intrinsic value change (in %) minus stock price change (in %) in the past 12 months.

We calculate the intrinsic value of JNPR stock by summing up the current values of future distributable cash flows generated by the company and dividing the sum by the number of outstanding shares. As such, the intrinsic value calculation depends entirely on projections. The more accurate your projections of the company's performance are - the more reliable is the intrinsic value calculation result. Please make sure to check the stock valuation input data below and adjust it if necessary. The quality of the output (intrinsic valuation result) is only as good as the quality of the input. See also DISCLAIMERS.

STOCK VALUATION INPUT DATA

Revenue (in 2016), $M
Initial revenue growth rate, %
Terminal revenue growth rate, %
Revenue decline factor
Initial discount rate, %
Discount rate multiplier
Variable cost ratio, %
Fixed operating expenses, $M
Interest rate on debt, %
Effective corporate tax rate, %
Production assets / Revenue, %
Life of production assets, yrs
Working capital / Revenue, %
Revenue / Adjusted assets
Adjusted equity ratio
Cash flow adjustment, % of Revenue
Book value of equity, $M
Shares outstanding, mln
Market capitalization, $bln 10.2

 

FINANCIAL STATEMENTS FORECAST and PRESENT VALUE CALCULATION

Fiscal year
2016(a)
   2017
   2018
   2019
   2020
   2021
   2022
   2023
   2024
   2025
   2026
   2027
   2028
   2029
   2030
   2031
   2032
   2033
   2034
   2035
   2036
   2037
   2038
   2039
   2040
   2041
   2042
   2043
   2044
   2045
   2046

INCOME STATEMENT

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Revenue growth rate, %
  2.72
  11.20
  10.58
  10.02
  9.52
  9.07
  8.66
  8.29
  7.97
  7.67
  7.40
  7.16
  6.95
  6.75
  6.58
  6.42
  6.28
  6.15
  6.03
  5.93
  5.84
  5.75
  5.68
  5.61
  5.55
  5.49
  5.45
  5.40
  5.36
  5.32
  5.29
Revenue, $m
  4,990
  5,549
  6,136
  6,751
  7,394
  8,064
  8,762
  9,489
  10,245
  11,031
  11,847
  12,696
  13,578
  14,494
  15,447
  16,439
  17,471
  18,545
  19,664
  20,830
  22,046
  23,314
  24,638
  26,021
  27,465
  28,974
  30,551
  32,201
  33,928
  35,734
  37,625
Variable operating expenses, $m
 
  4,471
  4,912
  5,373
  5,855
  6,358
  6,882
  7,427
  7,994
  8,584
  9,196
  9,525
  10,186
  10,874
  11,589
  12,333
  13,107
  13,913
  14,753
  15,627
  16,540
  17,491
  18,485
  19,522
  20,605
  21,737
  22,921
  24,159
  25,454
  26,809
  28,228
Fixed operating expenses, $m
 
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Total operating expenses, $m
  4,100
  4,471
  4,912
  5,373
  5,855
  6,358
  6,882
  7,427
  7,994
  8,584
  9,196
  9,525
  10,186
  10,874
  11,589
  12,333
  13,107
  13,913
  14,753
  15,627
  16,540
  17,491
  18,485
  19,522
  20,605
  21,737
  22,921
  24,159
  25,454
  26,809
  28,228
Operating income, $m
  890
  1,078
  1,224
  1,378
  1,538
  1,706
  1,880
  2,062
  2,251
  2,447
  2,651
  3,171
  3,391
  3,620
  3,858
  4,106
  4,364
  4,632
  4,911
  5,203
  5,506
  5,823
  6,154
  6,499
  6,860
  7,237
  7,631
  8,043
  8,474
  8,925
  9,397
EBITDA, $m
  1,097
  1,425
  1,576
  1,734
  1,899
  2,071
  2,250
  2,437
  2,631
  2,833
  3,042
  3,260
  3,487
  3,722
  3,967
  4,222
  4,487
  4,762
  5,050
  5,349
  5,662
  5,987
  6,327
  6,682
  7,053
  7,441
  7,846
  8,270
  8,713
  9,177
  9,662
Interest expense (income), $m
  93
  98
  122
  148
  174
  202
  231
  261
  293
  325
  359
  395
  432
  470
  509
  551
  593
  638
  685
  733
  783
  836
  891
  948
  1,008
  1,070
  1,136
  1,204
  1,275
  1,350
  1,428
Earnings before tax, $m
  827
  980
  1,102
  1,230
  1,364
  1,504
  1,649
  1,801
  1,958
  2,121
  2,291
  2,776
  2,960
  3,150
  3,349
  3,555
  3,770
  3,994
  4,227
  4,470
  4,723
  4,987
  5,263
  5,551
  5,852
  6,166
  6,495
  6,839
  7,198
  7,575
  7,969
Tax expense, $m
  234
  264
  298
  332
  368
  406
  445
  486
  529
  573
  619
  750
  799
  851
  904
  960
  1,018
  1,078
  1,141
  1,207
  1,275
  1,347
  1,421
  1,499
  1,580
  1,665
  1,754
  1,846
  1,944
  2,045
  2,152
Net income, $m
  593
  715
  804
  898
  996
  1,098
  1,204
  1,314
  1,429
  1,549
  1,673
  2,027
  2,161
  2,300
  2,445
  2,595
  2,752
  2,915
  3,086
  3,263
  3,448
  3,641
  3,842
  4,052
  4,272
  4,501
  4,741
  4,992
  5,255
  5,530
  5,817

BALANCE SHEET

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and short-term investments, $m
  2,586
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Total assets, $m
  9,657
  7,860
  8,691
  9,562
  10,472
  11,422
  12,411
  13,441
  14,512
  15,624
  16,781
  17,983
  19,232
  20,530
  21,880
  23,284
  24,746
  26,268
  27,853
  29,504
  31,227
  33,023
  34,899
  36,857
  38,902
  41,039
  43,274
  45,611
  48,056
  50,615
  53,293
Adjusted assets (=assets-cash), $m
  7,071
  7,860
  8,691
  9,562
  10,472
  11,422
  12,411
  13,441
  14,512
  15,624
  16,781
  17,983
  19,232
  20,530
  21,880
  23,284
  24,746
  26,268
  27,853
  29,504
  31,227
  33,023
  34,899
  36,857
  38,902
  41,039
  43,274
  45,611
  48,056
  50,615
  53,293
Revenue / Adjusted assets
  0.706
  0.706
  0.706
  0.706
  0.706
  0.706
  0.706
  0.706
  0.706
  0.706
  0.706
  0.706
  0.706
  0.706
  0.706
  0.706
  0.706
  0.706
  0.706
  0.706
  0.706
  0.706
  0.706
  0.706
  0.706
  0.706
  0.706
  0.706
  0.706
  0.706
  0.706
Average production assets, $m
  618
  688
  761
  837
  917
  1,000
  1,087
  1,177
  1,270
  1,368
  1,469
  1,574
  1,684
  1,797
  1,915
  2,038
  2,166
  2,300
  2,438
  2,583
  2,734
  2,891
  3,055
  3,227
  3,406
  3,593
  3,788
  3,993
  4,207
  4,431
  4,666
Working capital, $m
  2,236
  -388
  -430
  -473
  -518
  -564
  -613
  -664
  -717
  -772
  -829
  -889
  -950
  -1,015
  -1,081
  -1,151
  -1,223
  -1,298
  -1,376
  -1,458
  -1,543
  -1,632
  -1,725
  -1,821
  -1,923
  -2,028
  -2,139
  -2,254
  -2,375
  -2,501
  -2,634
Total debt, $m
  2,134
  2,659
  3,211
  3,789
  4,394
  5,024
  5,681
  6,365
  7,076
  7,815
  8,583
  9,381
  10,210
  11,072
  11,968
  12,901
  13,871
  14,882
  15,934
  17,031
  18,174
  19,368
  20,613
  21,913
  23,271
  24,690
  26,174
  27,726
  29,349
  31,048
  32,827
Total liabilities, $m
  4,694
  5,219
  5,771
  6,349
  6,954
  7,584
  8,241
  8,925
  9,636
  10,375
  11,143
  11,941
  12,770
  13,632
  14,528
  15,461
  16,431
  17,442
  18,494
  19,591
  20,734
  21,928
  23,173
  24,473
  25,831
  27,250
  28,734
  30,286
  31,909
  33,608
  35,387
Total equity, $m
  4,963
  2,641
  2,920
  3,213
  3,519
  3,838
  4,170
  4,516
  4,876
  5,250
  5,638
  6,042
  6,462
  6,898
  7,352
  7,824
  8,315
  8,826
  9,358
  9,913
  10,492
  11,096
  11,726
  12,384
  13,071
  13,789
  14,540
  15,325
  16,147
  17,007
  17,907
Total liabilities and equity, $m
  9,657
  7,860
  8,691
  9,562
  10,473
  11,422
  12,411
  13,441
  14,512
  15,625
  16,781
  17,983
  19,232
  20,530
  21,880
  23,285
  24,746
  26,268
  27,852
  29,504
  31,226
  33,024
  34,899
  36,857
  38,902
  41,039
  43,274
  45,611
  48,056
  50,615
  53,294
Debt-to-equity ratio
  0.430
  1.010
  1.100
  1.180
  1.250
  1.310
  1.360
  1.410
  1.450
  1.490
  1.520
  1.550
  1.580
  1.610
  1.630
  1.650
  1.670
  1.690
  1.700
  1.720
  1.730
  1.750
  1.760
  1.770
  1.780
  1.790
  1.800
  1.810
  1.820
  1.830
  1.830
Adjusted equity ratio
  0.336
  0.336
  0.336
  0.336
  0.336
  0.336
  0.336
  0.336
  0.336
  0.336
  0.336
  0.336
  0.336
  0.336
  0.336
  0.336
  0.336
  0.336
  0.336
  0.336
  0.336
  0.336
  0.336
  0.336
  0.336
  0.336
  0.336
  0.336
  0.336
  0.336
  0.336

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  593
  715
  804
  898
  996
  1,098
  1,204
  1,314
  1,429
  1,549
  1,673
  2,027
  2,161
  2,300
  2,445
  2,595
  2,752
  2,915
  3,086
  3,263
  3,448
  3,641
  3,842
  4,052
  4,272
  4,501
  4,741
  4,992
  5,255
  5,530
  5,817
Depreciation, amort., depletion, $m
  207
  347
  351
  356
  360
  365
  370
  375
  380
  386
  392
  89
  96
  102
  109
  116
  123
  131
  139
  147
  155
  164
  174
  183
  194
  204
  215
  227
  239
  252
  265
Funds from operations, $m
  1,135
  1,062
  1,156
  1,254
  1,356
  1,463
  1,574
  1,689
  1,810
  1,935
  2,064
  2,116
  2,256
  2,402
  2,554
  2,711
  2,875
  3,046
  3,224
  3,410
  3,603
  3,805
  4,015
  4,235
  4,465
  4,705
  4,957
  5,219
  5,494
  5,782
  6,083
Change in working capital, $m
  29
  -39
  -41
  -43
  -45
  -47
  -49
  -51
  -53
  -55
  -57
  -59
  -62
  -64
  -67
  -69
  -72
  -75
  -78
  -82
  -85
  -89
  -93
  -97
  -101
  -106
  -110
  -115
  -121
  -126
  -132
Cash from operations, $m
  1,106
  1,101
  1,197
  1,297
  1,401
  1,510
  1,623
  1,740
  1,863
  1,990
  2,122
  2,175
  2,318
  2,466
  2,620
  2,781
  2,947
  3,121
  3,302
  3,491
  3,688
  3,894
  4,108
  4,332
  4,566
  4,811
  5,067
  5,335
  5,615
  5,908
  6,215
Maintenance CAPEX, $m
  0
  -35
  -39
  -43
  -48
  -52
  -57
  -62
  -67
  -72
  -78
  -83
  -89
  -96
  -102
  -109
  -116
  -123
  -131
  -139
  -147
  -155
  -164
  -174
  -183
  -194
  -204
  -215
  -227
  -239
  -252
New CAPEX, $m
  -215
  -71
  -73
  -76
  -80
  -83
  -87
  -90
  -94
  -97
  -101
  -105
  -109
  -114
  -118
  -123
  -128
  -133
  -139
  -145
  -151
  -157
  -164
  -171
  -179
  -187
  -196
  -205
  -214
  -224
  -234
Cash from investing activities, $m
  -450
  -106
  -112
  -119
  -128
  -135
  -144
  -152
  -161
  -169
  -179
  -188
  -198
  -210
  -220
  -232
  -244
  -256
  -270
  -284
  -298
  -312
  -328
  -345
  -362
  -381
  -400
  -420
  -441
  -463
  -486
Free cash flow, $m
  656
  996
  1,085
  1,177
  1,274
  1,374
  1,479
  1,588
  1,702
  1,820
  1,943
  1,987
  2,119
  2,257
  2,400
  2,549
  2,704
  2,865
  3,033
  3,208
  3,391
  3,581
  3,780
  3,987
  4,204
  4,430
  4,667
  4,915
  5,174
  5,445
  5,729
Issuance/(repayment) of debt, $m
  179
  525
  552
  578
  604
  631
  657
  684
  711
  739
  768
  798
  829
  862
  896
  932
  970
  1,010
  1,052
  1,097
  1,144
  1,193
  1,245
  1,300
  1,358
  1,419
  1,484
  1,552
  1,623
  1,699
  1,779
Issuance/(repurchase) of shares, $m
  -262
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash from financing (excl. dividends), $m  
  -77
  525
  552
  578
  604
  631
  657
  684
  711
  739
  768
  798
  829
  862
  896
  932
  970
  1,010
  1,052
  1,097
  1,144
  1,193
  1,245
  1,300
  1,358
  1,419
  1,484
  1,552
  1,623
  1,699
  1,779
Total cash flow (excl. dividends), $m
  565
  1,521
  1,637
  1,756
  1,878
  2,005
  2,136
  2,272
  2,413
  2,559
  2,710
  2,785
  2,949
  3,119
  3,296
  3,481
  3,674
  3,875
  4,085
  4,305
  4,534
  4,774
  5,025
  5,287
  5,562
  5,850
  6,151
  6,467
  6,797
  7,144
  7,507
Retained Cash Flow (-), $m
  -389
  -264
  -279
  -293
  -306
  -319
  -332
  -346
  -360
  -374
  -389
  -404
  -420
  -436
  -454
  -472
  -491
  -511
  -533
  -555
  -579
  -604
  -630
  -658
  -687
  -718
  -751
  -785
  -822
  -860
  -900
Prev. year cash balance distribution, $m
 
  2,586
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash flow adjustment, $m
 
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash available for distribution, $m
 
  3,843
  1,358
  1,463
  1,572
  1,686
  1,804
  1,926
  2,053
  2,185
  2,322
  2,381
  2,529
  2,683
  2,843
  3,009
  3,183
  3,364
  3,553
  3,750
  3,956
  4,170
  4,395
  4,629
  4,875
  5,132
  5,400
  5,681
  5,976
  6,284
  6,607
Discount rate, %
 
  4.30
  4.52
  4.74
  4.98
  5.23
  5.49
  5.76
  6.05
  6.35
  6.67
  7.00
  7.35
  7.72
  8.11
  8.51
  8.94
  9.39
  9.86
  10.35
  10.87
  11.41
  11.98
  12.58
  13.21
  13.87
  14.56
  15.29
  16.05
  16.86
  17.70
PV of cash for distribution, $m
 
  3,684
  1,243
  1,273
  1,295
  1,307
  1,309
  1,301
  1,283
  1,255
  1,217
  1,131
  1,079
  1,020
  954
  884
  809
  732
  654
  577
  503
  431
  365
  303
  248
  200
  158
  122
  92
  69
  50
Current shareholders' claim on cash, %
  100
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0

Juniper Networks, Inc. designs, develops, and sells network products and services worldwide. The company offers various routing products, such as ACX series universal access routers to deploy new high-bandwidth services; MX series Ethernet routers that functions as a universal edge platform; PTX series packet transport routers; cloud customer premises equipment; and NorthStar controllers. It also provides switching products, including EX series Ethernet switches to address the access, aggregation, and core layer switching requirements of micro branch, branch office, and campus and data center environments; QFX series of core, spine, and top-of-rack data center switches; and OCX1100, an open networking switch. In addition, the company offers security products comprising SRX series services gateways for the data centers; Branch SRX family that includes SRX300 Series and SRX1500, which provides integrated firewall capabilities; vSRX Virtual Firewall that delivers various features of physical firewalls; Sky Advanced Threat Prevention, a cloud-based service for static and dynamic analysis; and Spotlight Secure Threat Intelligence Platform, a threat intelligence platform that aggregates threat feeds from various sources. Further, it offers Junos OS, a network operating system; Junos Space, a network management platform for creating network management applications that include network director, services activation director, security director, edge services director, service now, and service insight; and Contrail networking and cloud platform solutions. Additionally, the company provides technical support and professional services, as well as education and training programs. It sells its products through direct sales, distributors, value-added resellers, and original equipment manufacturer partners to end-users in the service provider and enterprise markets. Juniper Networks, Inc. was founded in 1996 and is headquartered in Sunnyvale, California.

FINANCIAL RATIOS  of  Juniper Networks (JNPR)

Valuation Ratios
P/E Ratio 17.5
Price to Sales 2.1
Price to Book 2.1
Price to Tangible Book
Price to Cash Flow 9.4
Price to Free Cash Flow 11.6
Growth Rates
Sales Growth Rate 2.7%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate 2.4%
Cap. Spend. - 3 Yr. Gr. Rate -2.2%
Financial Strength
Quick Ratio NaN
Current Ratio 0
LT Debt to Equity 43%
Total Debt to Equity 43%
Interest Coverage 10
Management Effectiveness
Return On Assets 7.2%
Ret/ On Assets - 3 Yr. Avg. 4.6%
Return On Total Capital 8.7%
Ret/ On T. Cap. - 3 Yr. Avg. 4.7%
Return On Equity 12.4%
Return On Equity - 3 Yr. Avg. 6.8%
Asset Turnover 0.5
Profitability Ratios
Gross Margin 62.2%
Gross Margin - 3 Yr. Avg. 62.5%
EBITDA Margin 22.6%
EBITDA Margin - 3 Yr. Avg. 16.2%
Operating Margin 17.8%
Oper. Margin - 3 Yr. Avg. 10.7%
Pre-Tax Margin 16.6%
Pre-Tax Margin - 3 Yr. Avg. 10.8%
Net Profit Margin 11.9%
Net Profit Margin - 3 Yr. Avg. 5.9%
Effective Tax Rate 28.3%
Eff/ Tax Rate - 3 Yr. Avg. -78.2%
Payout Ratio 25.8%

JNPR stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the JNPR stock intrinsic value calculation we used $4990 million for the last fiscal year's total revenue generated by Juniper Networks. The default revenue input number comes from 2016 income statement of Juniper Networks. You may change it if you feel that it should be adjusted for some unusual circumstances that are not expected to be repeated in the future or if you already know (from interim financial statements, for example) that this year's revenue is going to be quite different.

Revenue growth rate. Forecasted future revenue growth rate is the most important input parameter for the intrinsic value calculation. Unlike other input parameters that are reasonably expected to be in line with their historic averages or their historic trends, the revenue growth rate by and large is a wild card: nobody really knows what the company's revenue will be in the future. Of course, the level of unpredictability is different for different industries (utility companies being the most predictable and, thus, less risky).
    We use three input parameters to forecast the revenue growth rate in our JNPR stock valuation model: a) initial revenue growth rate of 11.2% whose default value is the revenue growth rate in the most recent quarter compared to the quarterly revenue a year ago; b) terminal revenue growth rate of 5% whose default value is chosen to be close to the average nominal (i.e. not adjusted for inflation) GDP growth rate; and c) revenue decline factor of 0.9, which stipulates that revenue growth rate in each forecasted year will be equal to the difference of the revenue growth rate in the preceding year and the terminal revenue growth rate multiplied by this revenue decline factor (with the passage of time the revenue growth rate will be approaching the terminal revenue growth rate, but not quite reaching it - though the difference could be infinitesimally small).
    At the revenue decline factor of 1, the future revenue growth rate is forecasted to be constant and equal to the initial revenue growth rate. The smaller the revenue decline factor, the faster the revenue growth rate will approach the terminal revenue growth.

Discount rate. The discount rate is used for determining the present value of future cash flows: future cash flows are "discounted" as at normal conditions (that translate into positive expected return on investment) one dollar today is worth more than the same dollar in the future. Unlike all other valuation models, we use variable discount rate, i.e. it increases for each consecutive year. This is done to account for higher risk of cash flows coming in further in the future.
    The initial discount rate of 4.3%, whose default value for JNPR is calculated based on our internal credit rating of Juniper Networks, is applied to the cash flow expected to be received a year from now (well, actually, to be precise, in the financial year following the base year - the last year for which we have financial statements). For each consecutive year the discount rate is multiplied by the discount rate multiplier of 1.05, e.i. each year it increases by 5%. Feel free to change this number to correspond to your level of risk assessment of Juniper Networks.
    By the way, it is easy to set the discount rate to be constant (this would make comparison with other valuation models easier): just set the discount rate multiplier equal to 1 and chose the magnitude of the initial discount rate to your liking.

Variable cost ratio is the ratio of variable costs (i.e. costs that fluctuate with fluctuation of the volume of production) to the revenue expressed as a percentage. In the calculation of intrinsic value of JNPR stock the variable cost ratio is equal to 81.2%.

Fixed operating expenses is just that - expenses that are not dependant on the volume of production. They are set to $0 million in the base year in the intrinsic value calculation for JNPR stock. These expenses increase with the level of inflation in subsequent years.

Interest rate on debt is the average all-in rate of interest paid by the company on its debt. It is set at 4.6% for Juniper Networks.

Corporate tax rate of 27% is the nominal tax rate for Juniper Networks. In reality, companies find ways to pay much less taxes than that or not to pay them at all.

Cash flow adjustment could be used for any adjustment the investor deems necessary. Most commonly we use this field to account for stock options-related effects in excess of what is reported on the company's income statement. The cash flow adjustment is expressed as a percentage of the revenue, and in the current valuation of the JNPR stock is equal to 0%.

Production assets are the company's assets used for manufacturing products or provision of services. In the valuation model input table they are expressed as a percentage of revenue and for JNPR are equal to 12.4%.

Life of production assets of 17.6 years is the average useful life of capital assets used in Juniper Networks operations. It is used to calculate yearly capital expenditures needed to keep these assets in good order - we call it the maintenance CAPEX.

Working capital is the difference between the company's current assets and liabilities. In the model we use the ratio of working capital to revenue, which for JNPR is equal to -7%. A negative number means that the company is apt at using financial resources of its suppliers and customers; a large positive number, on the other hand, means that it either provides in-kind financing to others or is not good at managing its inventories.

Book value of equity - $4963 million for Juniper Networks - is used in calculation of the "floor" for intrinsic valuation based on the discounted cash flow (DCF) method. Even if the prospects are very bad for a company, its assets could always be sold now for their current fair market value.

Shares outstanding of 375.929 million for Juniper Networks is needed to calculate the intrinsic value of one share.

Market capitalization is used here only for reference purposes and as a quick check that the share price and the number of shares outstanding numbers are correct - something especially to be cognizant about at stock splits. So, the market capitalization of Juniper Networks at the current share price and the inputted number of shares is $10.2 billion.

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COMPANY NEWS

▶ Ciscos Revenue Falls for 7 Consecutive Quarters   [Aug-18-17 07:39AM  Market Realist]
▶ What Analysts Recommend for Juniper Networks in July 2017   [Jul-28-17 10:36AM  Market Realist]
▶ Revenues for Juniper Networks 2Q17 Switching Business   [Jul-27-17 10:38AM  Market Realist]
▶ How Juniper Networks Views 3Q17   [07:45AM  Market Realist]
▶ "Fast Money" final trades: GILD, UAL and more   [Jul-26-17 05:59PM  CNBC Videos]
▶ Akamai, Juniper Tumble On Earnings Outlooks   [04:43PM  Investor's Business Daily]
▶ Juniper tops Street 2Q forecasts   [Jul-25-17 09:32PM  Associated Press]
▶ Juniper Networks Nears Buy Point As Earnings Top   [04:30PM  Investor's Business Daily]
▶ Juniper Networks Appoints New Chief Technology Officer   [Jul-18-17 04:15PM  Marketwired]
▶ A Debt Analysis of Apple   [Jul-12-17 03:05PM  Market Realist]
▶ How Juniper Is Trading in Comparison to Moving Averages   [Jul-11-17 10:38AM  Market Realist]
▶ Will Cloud Drive Revenue for Juniper in 2Q17?   [09:08AM  Market Realist]
▶ Juniper Stock Rises On Upgrade; Cloud Marketing Focus Paying Off   [Jul-10-17 05:30PM  Investor's Business Daily]
▶ What Analysts Expect from Juniper in 2Q17   [01:09PM  Market Realist]
▶ How Safe Is Cisco Systems and Its Dividend?   [Jun-19-17 01:35PM  Motley Fool]
▶ Where Do Apples Earnings and Ratios Stand?   [09:06AM  Market Realist]
▶ Juniper Networks Is Setting Up for a Jump   [Jun-05-17 01:46PM  TheStreet.com]
▶ The 10 Highest-Paying Silicon Valley Companies   [May-16-17 06:00AM  Motley Fool]
▶ Has Juniper Stock Grown Too Quickly?   [May-12-17 03:36PM  Investopedia]
▶ Industry Group Strength Gives Extra Boost To Superb Stocks   [02:30PM  Investor's Business Daily]
▶ Juniper Networks executive identified as victim in San Jose murder   [May-05-17 09:57AM  American City Business Journals]
▶ Cisco Rivals Post Q1 Earnings   [May-04-17 05:38PM  Investopedia]
▶ Inside Junipers Capital Returns   [May-03-17 10:36AM  Market Realist]
▶ How Analysts See Juniper Networks   [07:38AM  Market Realist]
▶ Why the Transition to Cloud Is Important to Juniper Networks   [May-02-17 10:36AM  Market Realist]
▶ Which Companies Are Now Outperforming 95% Of All Stocks?   [Apr-28-17 03:30PM  Investor's Business Daily]
▶ How Juniper Networks Views 2Q17   [09:09AM  Market Realist]
▶ How Juniper Networks Performed in 1Q17   [07:40AM  Market Realist]
▶ Cisco Rival Juniper Networks Rebounding With Cloud Customers   [Apr-26-17 04:55PM  Investor's Business Daily]
▶ Juniper Rising: Q1 Beats, Q2 EPS View Beats by a Penny   [Apr-25-17 05:24PM  Barrons.com]
Stock chart of JNPR Financial statements of JNPR
Valuation of Stocks

The paper VALUATION OF STOCKS: The Quest for Intrinsic Value provides a detailed description of our valuation model and discloses the calculation algorithm.

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