One recurring theme we see at 24/7 Wall Street is that technology stocks, for all of their glitter and notoriety, have greatly underperformed one of the longest and hottest bull market runs since the 1990s. Last week we wrote on the historical outperformance of the sector when price-to-earnings ratios drop below a certain level. The technology team at Merrill Lynch are seeing the same value in the sector that other major Wall Street firms are.

In a new report that focused on the top telecom equipment companies, Merrill Lynch posted some of the key takeaways from their Global Technology conference. Not only were they able to get an idea from top corporate executives on new product development and roll-out. Analysts also got a rundown on how spending and revenue trends are shaping up for the second half of the year.

Here are the top telecom equipment technology stocks to buy at Merrill Lynch.

Juniper Networks Inc. (NYSE: JNPR) CEO Kevin Johnson told Merrill Lynch analysts that the company was doing well in the service provider vertical due to improving demand in the United States. He also said that the substantial increase in network traffic is pushing service providers to improve their network capacities, which was translating to improving demand at Juniper. Merrill Lynch has $23 price target for the stock. The Thomson/First Call estimate is at $19.

Qualcomm Inc. (NASDAQ: QCOM) has the advantage of solid chip sales and consistent royalty revenues. Smartphone demand may taper in some areas, but worldwide growth is expected to continue, especially in Asia. Merrill Lynch has a $75 price target, while the consensus is higher at $77. Investors are paid a 2.2% dividend.

F5 Networks Inc. (NASDAQ: FFIV) remains a top stock to buy at Merrill Lynch. F5 Networks provides application delivery networking technology that secures and optimizes the delivery of network-based applications and the security, performance and availability of servers and other network resources. Merrill Lynch has a price objective of $95, and the consensus target is lower at $90.

Sourcefire Inc. (NASDAQ: FIRE) provides intelligent cybersecurity technologies worldwide. The company’s network security products include Sourcefire Next Generation Intrusion Prevention System to notify users of network traffic and block threats and Sourcefire Next Generation Firewall with application control and firewall capabilities. Many analysts think cybersecurity will be one of the hottest technology subsectors for years to come. Merrill Lynch has a $68 target, but the consensus estimate on the stock is $63.

Allot Communications Ltd. (NASDAQ: ALLT) develops, markets and sells intelligent Internet protocol service optimization solutions in the United States, the Middle East, Africa, Europe, Asia, Oceania and rest of the Americas. This top small-cap name also may be a possible takeover candidate. Merrill Lynch has a $20 target, while the consensus is at $15. A move to the Merrill Lynch target would represent a 73% increase from current trading levels.

Cisco Systems Inc. (NASDAQ: CSCO) executives reiterated previous bullish statements on a gradual recovery cycle at the Merrill Lynch conference. They also refuted competitors’ statements on elevated pricing aggressiveness by Cisco. The Merrill Lynch price target for the stock is $26, the same as the consensus target. Investors are paid a 2.8% dividend.

If you combine the underperformance by the technology sector, with the possibility for an increase in spending in the second half of 2013, you may have the ingredients for some substantial portfolio gains. A further sell-off in the markets this summer might provide the ultimate entry point for investors to take advantage of.

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