) to outperform from neutral.
Analyst Kenneth Muth said the upgrade is based on strong Router performance and improving trends for its Security unit. He noted that third quarter results exceeded expectations and guidance has been raised every quarter in 2005. He says, importantly, that Security recorded good results and operating leverage metrics improved. He raised his 70 cents 2005 earnings per share estimate to 73 cents, and his 84 cents 2006 estimate to 95 cents. He raised his target to $30, which was based on 32 times his new 2006 earnings per share estimate. He says Juniper Networks has demonstrated superior execution and its macro IP trends remain very robust, which he believes can continue over the next 24-36 months.