Cisco Systems, Inc. (CSCO) Will Not Be The Immobile Sentinel Forever: Juniper Networks, Inc. (JNPR), Alcatel Lucent SA (ADR) (ALU)

With over $45 billion in cash you know that Cisco can buy its way into something new if it wanted. It seems content to sit back and have its internal technologies for now. I have not seen any major acquisitions, meaning billions not millions, that will take the company in a new direction. I consider this a positive, but people hungry for the days of rapid Cisco growth will be disappointed.

LTE small cells will be a nice addition, but it will not be the explosive innovation. Neither will Cisco’s cautious entry into software-defined networking. Cautious because it covers many bases. Cisco is maintaining its focus on the importance of its hardware, while the hype downplays hardware. SDN is still in the early stages so do not get too hung up. Cisco will realize that it needs to do something to get ahead of the curve instead of behind or on it. The large cash position will help it act quickly and decisively when it chooses to.

The only new thing I have seen from Juniper is their purchase of Contrail. I doubt the company had much in the way of development accomplished, but Juniper at least got the expertise of all the employees. Contrail was very new, and products take years to develop. It will be a while before anything comes of that acquisition if anything ever does.

Conclusion

I prefer Cisco over Juniper Networks, Inc. (NYSE:JNPR). In addition to Cisco Systems, Inc. (NASDAQ:CSCO), I would take a chunk of Alcatel-Lucent. That way you have the safer champion, and the bleeding underdog. Alcatel-Lucent has its lightRadio system, and its new core router. There are some other products, but these are some of the newest and most impressive. Alcatel Lucent SA (ADR) (NYSE:ALU) is a company trying to use innovation to dig itself out of its hole. I have surveyed the technology and I think it stands a shot. I think both Cisco and Alcatel-Lucent are a buy.

The article Cisco Will Not Be The Immobile Sentinel Forever originally appeared on Fool.com and is written by  Nihar Patel

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