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Juniper (JNPR) to Power 21Vianet's (VNET) Data Center Expansion

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Zacks Equity Research
·3 min read
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Juniper Networks Inc. JNPR has inked a definitive agreement with 21Vianet Group, Inc. VNET to deploy its routing solutions in order to meet the exponential growth in data traffic. The deal with the leading carrier-neutral data center service provider in China is also likely to help Juniper address the digital transformation needs of customers as the resurgent coronavirus wave portend fresh lockdown restrictions.

Operating a network of more than 50 data centers across 20 cities in China with more than 51,000 network cabinets that offer above 2000G of port capacity and 1000G of dedicated high-speed cloud access, 21Vianet is catering to an ever-growing customer base. The dedicated MX Series Universal Routing Platforms from Juniper that utilize segment routing traffic engineering (SR-TE) protocols are likely to upgrade the 21Vianet’s network and enable it to continue providing unhindered service to the swelling customer base.

In particular, the infrastructure upgrade will improve network capacity, scale and stability while boosting efficiency and automation capabilities through the implementation of SR-TE protocols. This, in turn, will lower operational costs and improve end-user experience with simplified traffic management across multiple network domains while fulfilling the demands of higher bandwidth capacity. Deployed as core routers across 21Vianet’s expanded interconnected data center, Juniper routing platforms will enable network administrators to seamlessly migrate applications within and between various data centers for operational efficiency and optimization of network traffic flow.

Juniper is set to capitalize on the growing demand for data center virtualization, cloud computing and mobile traffic packet/optical convergence. The company is offering new suites of products, such as the T4000 core router, QFX data center platform, ACX and PTX packet/optical solution, among others. With the growing usage of smartphones and tablets, mobile data traffic has gone up. This has resulted in higher demand for advanced networking architecture, which is leading service providers to spend more on routers and switches. Juniper is expected to benefit from the higher spending pattern among carriers to upgrade their networks for supporting the incremental growth in data traffic.

Despite some short-term challenges, particularly within the cloud and service provider verticals, Juniper expects healthy progress in most areas of its business, which augurs well for its long-term growth. The company has made significant changes to its go-to-market structure to better align its sales strategies with each of its core customer verticals. Moreover, several new products are in the pipeline, which are expected to further strengthen its competitive position across service provider, cloud and enterprise market.

The stock has gained 15% over the past year compared with the industry’s rally of 64.5%.



Juniper currently has a Zacks Rank #3 (Hold). Some better-ranked stocks in the industry are Nokia Corporation NOK, and Sierra Wireless, Inc. SWIR, both carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Nokia has a long-term earnings growth expectation of 1.5%. It delivered a positive earnings surprise of 40.2%, on average, in the trailing four quarters.

Sierra Wireless has a long-term earnings growth expectation of 12.5%.

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21Vianet Group, Inc. (VNET) : Free Stock Analysis Report

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