In a set of quick updates, Evercore ISI and analyst Amit Daryanani have removed Juniper Networks ( NYSE: JNPR ) and TE Connectivity ( NYSE: TEL ) from its Tactical Outperform List.
The tactical call on Juniper ( JNPR ) was predicated on the company reporting upside to earnings - and while it did beat top-line expectations , earnings per share were "disappointing."
Revenue growth was robust and broad-based across all three verticals, Daryanani notes. "Top-line strength however continues to be offset by supply headwinds that continue to negatively impact JNPR’s gross margins," he said, noting those margins arrived at 56.2% vs. an expected 58%. The company expects the margins to stay muted in the current quarter, he noted.
He's keeping a rating at In Line with a $33 price target (implying 18% upside).
Similarly, TE Connectivity ( TEL ) was made a Tactical Outperform due to expectations of strong guidance and upside in quarterly earnings . And while the report was strong, along with September-quarter outlook, "we are seeing orders starting to decline, which could weigh down auto markets and mix could potentially skew more negative going forward."
Still, "Fundamentally, TEL is showing a strong and more sustained content narrative vs. street expectations that should provide a structural framework for higher organic growth in FY23 and beyond," Daryanani said.
He's sticking with an Outperform rating there and a price target of $145, implying 8% upside.
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Evercore pulls Juniper Networks, TE Connectivity from Tactical Outperforms