Analyst Sees 4 Top Enterprise Technology Stocks as Q4 Sales Winners

By Lee Jackson Published Jan 15, 10:20AM EST

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The disappointing retail sales numbers for December have put a huge damper on what was already a teetering market. While retail may be a touch slower than expected, value-added-reseller (VAR) for the fourth quarter is showing that some of the top enterprise tech companies may have had a very solid selling period. A new report from the analysts at Stifel focuses on stocks that may see price movement as a result.

The Stifel survey of resellers is a very thorough examination of sales and trends for the fourth quarter. With year-end buying and other factors moving the needle, a majority of the VAR’s are expecting an overall 10% uptick in sales.

Here are five stocks rated Buy at Stifel that may be beneficiaries of the strong fourth-quarter sales.

Arista Networks Inc. (NYSE: ANET) went public last June and continued to be one of the hot IPO stories of 2014. The company delivers software-driven cloud networking solutions for large data center and computing environments. In addition, the company’s 10/40/100 Gigabit Ethernet switches offer scalability and performance, and have over 2,700 customers, as well as more than 2 million cloud networking ports deployed worldwide. The Stifel team thinks that the company is continuing to see strong momentum with cloud providers, who could ratchet capital expenditure spending up sharply.

The Stifel price target for the stock is $95. The Thomson/First Call consensus price target is $88.60. Shares closed Wednesday at $65.06.

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F5 Networks Inc. (NASDAQ: FFIV) is a stock that many Wall Street analysts feel will continue to beat earnings expectations. The company provides solutions for an application-based world and helps organizations seamlessly scale cloud, data center and software defined networking deployments to successfully deliver applications to anyone, anywhere, at any time. These are the areas along with security, where many analysts expect possible big orders. The Stifel data indicate that its fourth-quarter sales were tracing inline or better than current expectations.

Stifel has a $140 price target, while the consensus figure is at $134.14. Shares closed down over 3% at $125.60 a share.

MobileIron Inc. (NASDAQ: MOBL) was another tech IPO last year and is considered one of the up-and-coming leaders in enterprise mobile security. The company develops and provides an information technology platform for enterprises to secure and manage mobile applications, content and devices. From 2009 to 2013, MobileIron revenues grew faster than any other technology company, with a cumulative growth of over 120,000%.

The Stifel price target is $13, and the consensus target is higher at $13.50. The stock closed on Wednesday at $9.96.

Infinera Corp. (NASDAQ: INFN) provides Intelligent Transport Networks for network operators, enabling reliable, easy to operate, high-capacity optical networks. Infinera leverages its unique large-scale photonic integrated circuits to deliver innovative optical networking solutions for the most demanding network environments. Intelligent Transport Networks enable carriers, loud network operators, governments and enterprises to automate, converge and scale their data center, metro, long-haul and subsea optical networks.

Stifel has a $17 price target, and the consensus is set at $15.05. Shares ended the trading day Wednesday at $13.76.

Ruckus Wireless Inc. (NYSE: RKUS) is a global supplier of advanced wireless systems for the rapidly expanding mobile Internet infrastructure market. The company offers a wide range of indoor and outdoor “Smart Wi-Fi” products to mobile carriers, broadband service providers and corporate enterprises, and it has over 44,000 end-customers worldwide. Ruckus technology addresses Wi-Fi capacity and coverage challenges caused by the ever-increasing amount of traffic on wireless networks due to accelerated adoption of mobile devices such as smartphones and tablets. The Stifel team sees an expansion in Wi-Fi and increased purchasing of Wi-Fi equipment in 2015.

Stifel has a big $17 price target, and the consensus price target is $15.75. The stock closed Wednesday at $9.41 a share.

ALSO READ: 5 Chip Equipment Stocks to Buy as Industry Rebounds in 2015

Note that these stocks are very aggressive and only suitable for accounts that can tolerate volatility. They are all solid tech buys for 2015, however, in a part of the sector gaining strength in a slow-growth world.

About the Author Lee Jackson →

Lee Jackson has covered Wall Street analysts' equity and debt research and equity strategy daily for 24/7 Wall St. since 2012. His broad and diverse career, which included a stint as the creative services director at the NBC affiliate in Austin, Texas, gives him unique insight into the financial industry and world.

Lee Jackson's journey in the financial industry spans over 30 years, with nearly two decades as an institutional equity salesperson at Bear Stearns, Lehman Brothers, and Morgan Stanley. His career was marked by his presence on the sell side during pivotal Wall Street events, from the dot.com rise and bubble to the Long Term Capital Management debacle, 9/11, and the Great Recession of 2008. This is a testament to his resilience and adaptability in the face of market volatility.

Lee Jackson’s practical financial industry experience, acquired from a career at some of the biggest banks and brokerage firms, is complemented by a lifetime of writing on various platforms. This unique combination allows him to shed light on the intricacies and workings of Wall Street in a way that only someone with deep insider experience and knowledge can. Moreover, his extensive network across Wall Street continues to provide direct access for him and 24/7 Wall St., a privilege few firms enjoy.

Since 2012, Jackson’s work for 24/7 Wall St. has been featured in Barron’s, Yahoo Finance, MarketWatch, Business Insider, TradingView, Real Money, The Street, Seeking Alpha, Benzinga, and other media outlets. He attended the prestigious Cranbrook Schools in Bloomfield Hills, Michigan, and has a degree in broadcasting from the Specs Howard School of Media Arts.