Climbing 1.2x In Six Months, Juniper Networks Stock Running Out Of Steam?

Juniper Networks stock (NYSE: JNPR) has seen an impressive rise of 22% over the last six months and currently trades at $29 per share. The sharp rally came due to a rise in demand for networking products, driven by the shift toward working from home. Juniper Networks saw a 10% rise in revenue over the first half of FY 2021, compared to the first six months of FY 2020. Revenue came in at $1.43 billion for 1H ’21, up from $1.3 billion in 1H ’20. However, rising expenses saw a drop in operating income from $130 million to $113 million. EPS came in lower at $0.09 for the first half of 2021, down from $0.25 in 1H ’20. However, this was largely due to a $61 million loss on extinguishment of debt.

So, after the recent rally will Juniper Networks stock continue its upward trajectory over the coming weeks, or is a correction in the stock more likely? According to the Trefis Machine Learning Engine, which identifies trends in a company’s stock price data for the last ten years, returns for JNPR stock average close to -0.8% in the next one-month (21 trading days) period after experiencing a 22.5% rise over the previous six-month (126 trading days) period. However, the stock has a low 34% probability of dropping marginally over the next one month. But how would these numbers change if you are interested in holding JNPR stock for a shorter or a longer time period? You can test the answer and many other combinations on the Trefis Machine Learning Engine to test Juniper Networks stock chances of a rise after a fall and vice versa. You can test the chance of recovery over different time intervals of a quarter, month, or even just one day!

MACHINE LEARNING ENGINE – try it yourself:

IF Juniper Networks stock moved by -5% over five trading days, THEN over the next 21 trading days, JNPR stock moves an average of 4.2 percent, with a strong 62.8% probability of a positive return.

Some Fun Scenarios, FAQs & Making Sense of Juniper Networks Stock Movements:

Question 1: Is the average return for JNPR stock higher after a drop?

Answer:

Consider two situations,

Case 1: JNPR stock drops by -5% or more in a week

Case 2: JNPR stock rises by 5% or more in a week

Is the average return for Juniper Networks stock higher over the subsequent month after Case 1 or Case 2?

JNPR stock fares better after Case 1, with an average return of 4.2% over the next month (21 trading days) under Case 1 (where the stock has just suffered a 5% loss over the previous week), versus, an average return of 1.2% for Case 2.

In comparison, the S&P 500 has an average return of 3.1% over the next 21 trading days under Case 1, and an average return of just 0.5% for Case 2 as detailed in our dashboard that details the average return for the S&P 500 after a fall or rise.

Try the Trefis machine learning engine above to see for yourself how JNPR stock is likely to behave after any specific gain or loss over a period.

Question 2: Does patience pay?

Answer:

If you buy and hold Juniper Networks stock, the expectation is over time the near-term fluctuations will cancel out, and the long-term positive trend will favor you – at least if the company is otherwise strong.

Overall, according to data and Trefis machine learning engine’s calculations, patience absolutely pays for most stocks!

For Juniper Networks stock, the returns over the next N days after a -5% change over the last five trading days is detailed in the table below, along with the returns for the S&P500:

Question 3: What about the average return after a rise if you wait for a while?

Answer:

The average return after a rise is understandably lower than after a fall as detailed in the previous question. Interestingly, though, if a stock has gained over the last few days, you would do better to avoid short-term bets for most stocks.

Juniper’s returns over the next N days after a 5% change over the last five trading days is detailed in the table below, along with the returns for the S&P500:

It’s pretty powerful to test the trend for yourself for Juniper Networks stock by changing the inputs in the charts above.

What if you’re looking for a more balanced portfolio instead? Here’s a high-quality portfolio that’s beaten the market since 2016.

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