F5 Networks Shares Popped: What You Need to Know

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of network equipment specialist F5 Networks (Nasdaq: FFIV  ) jumped as high as 14% in intraday trading after its quarterly results and outlook topped analyst estimates.

So what: The demand for F5's products -- especially from providers servicing the booming mobile market -- was obviously stronger than Mr. Market expected. F5 posted a fourth-quarter profit of $63.9 million, or $0.79 a share, which was nicely above the average analyst estimate of $0.72 a share.

Now what: With management also issuing upside guidance for next quarter, F5's short-term picture looks particularly bright. But while business should continue benefitting from the trend towards data center consolidation and cloud computing, shareholders might not be able to at these valuation levels. With the stock having more than doubled over the past year and sporting a lofty P/E of about 55, Fools would do well to play those trends with bigger, stronger, and, most importantly, cheaper rivals like Cisco Systems (Nasdaq: CSCO  ) or Brocade (Nasdaq: BRCD  ) .

Interested in more info on F5? Add it to your watchlist by clicking here.

Fool contributor Brian Pacampara owns no position in any of the companies mentioned. Try any of our Foolish newsletter services free for 30 days.

True to its name, The Motley Fool is made up of a motley assortment of writers and analysts, each with a unique perspective; sometimes we agree, sometimes we disagree, but we all believe in the power of learning from each other through our Foolish community. The Fool's disclosure policy always gets a perfect score.


Read/Post Comments (0) | Recommend This Article (2)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 1346795, ~/Articles/ArticleHandler.aspx, 11/28/2014 3:44:21 PM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...


Advertisement