Trafficking in F5 Networks
F5 Networks focuses on application delivery networking products that help manage Internet traffic to servers and network devices. FFIV is an impressive technology company, not a household name but the kind of quality that we like. This is a growth stock with no debt and a great track record and they serve an area that will continue to grow – Internet traffic. FFIV pays no dividend; therefore we recommend a ½ position.
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FFIV trades at 20.4X earnings based on the adjusted trailing 12 months EPS of $4.49 per share. Their Return on Capital (ROC) is 117% and they have an earnings yield of 7.6%. Market capitalization is $ 7.2 billion.
LOW VALUATION IN F5 NETWORKS AT $ 91.75 (FFIV, $91.35)
S&P rates FFIV at 4* with a $118.00 target. The Purple Chips target is $120.00 in 12 to 18 months.
