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HP Enterprise's Possible Bid: Juniper Networks Stocks Skyrocket HP Enterprise’s Possible Bid: Juniper Networks Stocks Skyrocket

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Juniper Networks headquarters in Sunnyvale, California, USA

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On Tuesday, Juniper Networks (NYSE:JNPR) experienced a dramatic surge in its share price, soaring by over 21%. Rumors regarding advanced acquisition negotiations with HP Enterprise (HPE) lie at the core of this unprecedented spike.

The Wall Street Journal has reported that HP Enterprise may potentially acquire Juniper for an estimated $13 billion. Notably, HP Enterprise currently boasts a market value of approximately $23 billion, while Juniper’s worth hovers just below $10 billion. The looming deal between the cloud computing giant and the networking equipment manufacturer could materialize as early as this week based on the report’s claims.

The aftermath saw HP Enterprise shares taking a nosedive, plummeting by more than 8.5% as the trading session drew to a close.

Financiers on Wall Street unveiled a mixed response to this pivotal development.

Bank of America analyst Wamsi Mohan, who holds a neutral rating and a $19 price target on HP Enterprise, expressed reservations about the potential acquisition, suggesting a divergence from the company’s prevailing trajectory towards the as-a-Service model. However, Mohan also acknowledged the possible benefits of gaining access to new channels, customers, and a more expansive networking footprint.

The strategic rationale behind the acquisition elicited a mΓ©lange of opinions,

β€œGiven the company’s narrow focus on [service providers] customers and high-throughput firewalls, it remains to be seen whether Juniper’s security segment is something HPE would keep over time. 20% of Juniper’s revenue is predominantly tied to switching and wireless,” Mohan wrote.

Wells Fargo analyst Aaron Rakers offered his contemplation on the purchase, pondering the underlying strategic rationale. β€œ[W]e think [HP Enterprise] investors would question the strategic rational underlying this large of a platform [acquisition and] expect emphasis on leveraging Juniper’s Mistified portfolio integration/leverage,” Rakers ventured.

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