Investing.com – Juniper Networks Inc (NYSE:)’ inventory may drop by about 5% if its merger with Hewlett Packard Enterprise (NYSE:) fails, Citi analysts mentioned in a notice on Tuesday.
Citi’s warning follows a Bloomberg report suggesting the U.S. Division of Justice (DOJ) may resolve this week whether or not to problem the deal.
Analyst at Citi estimated Juniper’s inventory may fall to $33, based mostly on a historic premium to rival Cisco Techniques (NASDAQ:) or a ahead price-to-earnings a number of of 16.3 utilized to Juniper’s projected 2026 earnings.
Juniper shares closed at $35 on Tuesday.
Hypothesis is mounting that the businesses would possibly delay finalizing the merger till January, hoping for a extra beneficial regulatory atmosphere underneath the incoming Trump administration.
In January, HPE mentioned it was buying the networking tools producer for $14 billion in an all-cash deal, to reinforce the corporate’s AI choices. HPE has supplied $40 per share to Juniper shareholders.
The transaction is predicted to be funded via financing commitments for $14 billion in time period loans and is prone to shut in late 2024 or early 2025, topic to regulatory approvals.
The acquisition is predicted to double HPE’s networking enterprise, and comes as corporations more and more spend money on AI-related infrastructure amid an industry-wide increase.
