Latest news with #AristaNetworks
Yahoo
a day ago
- Business
- Yahoo
Buy 5 AI Laggards of Past Month to Tap Solid Upside in the Short Term
The artificial intelligence (AI)-driven astonishing bull run of 2023 and 2024 has suffered major hurdles in 2025. The tariff and trade policies of the Trump administration, the Fed's ambiguity over further rate cuts this year, fears of a near-term recession and the availability of a low-cost Chinese AI platform have unnerved investors. However, the technology sector has lately returned to its northward trajectory. Expectations of a U.S.-China trade deal and the ongoing negotiations with several other major trading partners of the United States boosted market participants' confidence. Despite these positives, several large-cap AI stocks provided negative returns in the past month. Surprisingly, a handful of these stocks with a favorable Zacks Rank currently offer strong price upside potential in the short term. Five such stocks are: Arista Networks Inc. ANET, HubSpot Inc. HUBS, Twilio Inc. TWLO, Adobe Inc. ADBE and Okta Inc. OKTA. Each of our picks carries either a Zacks Rank #1 (Strong Buy) or 2 (Buy). You can see the complete list of today's Zacks #1 Rank stocks here. The chart below shows the price performance of our five picks in the past month. Image Source: Zacks Investment Research Zacks Rank #2 Arista Networks is well-positioned with the right network architecture for client-to-campus data center cloud and AI networking backed by three guiding principles. These include the best-in-class, highly proactive products with resilience, zero-touch automation and telemetry with predictive client-to-cloud one-click operations with granular visibility and prescriptive insights for deeper AI algorithms. ANET's EOS Smart AI Suite and Arista AVA (Autonomous Virtual Assist) enhance AI job monitoring, deep-dive analytics, and proactive performance issue resolution. Its AI suite also focuses on network security and optimization. ANET's AI-powered cloud networking solutions provide predictable performance and programmability, enabling seamless integration with third-party applications for network management, automation and orchestration. Arista AVA offers augmentation of pervasive visibility, continuous threat detection, and enforcement. The growing demand for 200- and 400-gig high-performance switching products augurs well for ANET's long-term growth. Arista Networks has an expected revenue and earnings growth rate of 18.7% and 12.8%, respectively, for the current year. The Zacks Consensus Estimate for current-year earnings has improved 3.6% in the last 60 days. The short-term average price target of brokerage firms for the stock represents an increase of 23.4% from the last closing price of $90.24. The brokerage target price is currently in the range of $87-$130. This indicates a maximum upside of 44% and a downside of 3.6%. Zacks Rank #2 HubSpot provides a cloud-based customer relationship management platform for businesses in the Americas, Europe, and the Asia Pacific. HUBS is witnessing steady multi-hub adoption from enterprise customers in the premium market. Pricing optimization in HUBS' starter edition is leading to solid client additions in the lower end of the market. The integration of HubSpot AI, which includes state-of-the-art features, such as AI assistance, AI agents, AI insights and ChatSpot, is driving more value to customers. HUBS' seat pricing model lowers the barrier for customers to get started with its business and mitigates pricing friction for upgrades. The growing adoption of inbound applications is a tailwind. HubSpot has an expected revenue and earnings growth rate of 15.4% and 15%, respectively, for the current year. The Zacks Consensus Estimate for current-year earnings has improved 0.1% in the last 30 days. The short-term average price target of brokerage firms for the stock represents an increase of 37.5% from the last closing price of $544.46. The brokerage target price is currently in the range of $645-$930. This indicates a maximum upside of 70.8% and no downside. Zacks Rank #1 Twilio is a leading provider of cloud communications Platform-as-a-Service in the United States and internationally. TWLO is focusing on generative AI offerings to tap the growing opportunities in this space. In this regard, TWLO launched Customer AI technology in June 2023, which powerfully combines customer engagement platform data, generative and predictive AI, and large language models (LLMs) to unlock stronger customer relationships for brands. TWLO is integrating generative AI capabilities across its platform and every customer touchpoint. The company believes that by training LLMs for customers with their data inside its Segment customer data platform, Twilio will be able to help customers enter the AI race multiple steps ahead of their peers. TWLO has also partnered with Alphabet Inc. (GOOGL) for Google Cloud to integrate generative AI into the Twilio Flex customer engagement platform. Twilio's initiative to integrate generative and predictive AI technology across its platform is likely to boost its revenue growth over the long run. Twilio enables companies to create personalized, customer-aware experiences powered by OpenAI. Through this integration, Twilio customers will be able to use OpenAI's GPT-4 model to power new generative capabilities in Twilio Engage, its multichannel marketing solution built on the Segment Customer Data Platform. Twilio has an expected revenue and earnings growth rate of 7.9% and 22.3%, respectively, for the current year. The Zacks Consensus Estimate for current-year earnings has improved 6.9% in the last 60 days. The short-term average price target of brokerage firms for the stock represents an increase of 10.8% from the last closing price of $116.68. The brokerage target price is currently in the range of $75-$170. This indicates a maximum upside of 45.7% and a downside of 35.7%. Zacks Rank #2 Adobe has extensively implemented AI applications across its flagship products, such as Photoshop, Illustrator, Lightroom, and Premiere. Earlier this year, ADBE introduced generative AI-driven Adobe Firefly. Moreover, Adobe Acrobat and Reader AI Assistant help users summarize documents and answer questions, saving time and helping users accomplish tasks faster. Using its new AI-driven cloud-based platform, ADBE is also diversifying into digital marketing services, offering data mining services that help businesses measure page views, purchases and social media sites. Adobe Marketing Cloud enables marketers to deliver personalized web experiences across multiple devices, manage multichannel campaigns and optimize media monetization. ADBE has launched Adobe Express, an application for quick editing effects. Leveraging generative AI, this tool is useful for short-form video content like Instagram Reels. Adobe also launched an AI-based Express app for iOS and Android. Adobe has an expected revenue and earnings growth rate of 9.5% and 11.8%, respectively, for the current year. The Zacks Consensus Estimate for current-year earnings has improved 1.2% in the last seven days. The average short-term price target of brokerage firms represents an increase of 29.7% from the last closing price of $378.04. The brokerage target price is currently in the range of $380-$605. This indicates a maximum upside of 60.1% and no downside. Zacks Rank #2 Okta operates as an identity partner in the United States and internationally. OKTA offers a suite of products and services used to manage and secure identities, such as Single Sign-On, which enables users to access applications in the cloud or on-premises from various devices. OKTA leverages AI through its Okta AI platform, which enhances security while improving user experience and simplifying administration. Key applications include Identity Threat Protection, Log Investigator, and Auth for GenAI. This AI-enabled platform is integrated with OKTA's Workforce Identity and Customer Identity Clouds. OKTA's Adaptive Multi-Factor Authentication provides a layer of security for cloud, mobile, web applications and data, while API Access Management enables organizations to secure APIs. Access Gateway enables organizations to extend Workforce Identity Cloud, and Okta Device Access enables end users to securely log in to devices with Okta credentials. OKTA has expected revenue and earnings growth rates of 9.4% and 16.7%, respectively, for the current year (ending January 2026). The Zacks Consensus Estimate for current-year earnings has improved 2.8% over the last 30 days. The average short-term price target of brokerage firms represents an increase of 26.2% from the last closing price of $99. The brokerage target price is currently in the range of $75-$142. This indicates a maximum upside of 43.4% and a downside of 24.2%. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Adobe Inc. (ADBE) : Free Stock Analysis Report Arista Networks, Inc. (ANET) : Free Stock Analysis Report HubSpot, Inc. (HUBS) : Free Stock Analysis Report Twilio Inc. (TWLO) : Free Stock Analysis Report Okta, Inc. (OKTA) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research
Globe and Mail
2 days ago
- Business
- Globe and Mail
Here's Why Nvidia Caused BNP Paribas to Downgrade Arista Networks Stock (ANET)
Shares of Arista Networks (ANET) are down at the time of writing after the cloud networking firm was downgraded by BNP Paribas. In fact, 4.5-star analyst Karl Ackerman lowered his rating on the stock from Outperform to Neutral due to increasing competitive pressure from Nvidia (NVDA) and low-cost whitebox vendors like Celestica (CLS) and Accton. These new threats could take market share away from Arista in the AI networking space. Confident Investing Starts Here: Easily unpack a company's performance with TipRanks' new KPI Data for smart investment decisions Receive undervalued, market resilient stocks right to your inbox with TipRanks' Smart Value Newsletter Ackerman explained that the AI networking market is shifting quickly from Ethernet to InfiniBand, with Nvidia and other companies positioned to dominate this segment. Indeed, Nvidia's upcoming Quantum-X switches, which are expected to support 1.6T speeds and launch in the second half of 2025 — about a year ahead of comparable Ethernet products — may significantly limit Arista's near-term growth opportunities. In addition, the move toward rack-scale GPU architectures is accelerating this shift, thereby giving Nvidia and other players an advantage when it comes to capturing the bulk of the Ethernet switching market. As a result of these competitive pressures, Ackerman revised his outlook for Arista's AI-related revenue. He now expects the company to generate $2.5 billion in AI sales by 2027, which is down significantly from his previous forecast of $3.4 billion. Is ANET Stock a Good Buy? Turning to Wall Street, analysts have a Moderate Buy consensus rating on ANET stock based on 11 Buys, four Holds, and zero Sells assigned in the past three months, as indicated by the graphic below. Furthermore, the average ANET price target of $109.38 per share implies 17% upside potential. See more ANET analyst ratings
Business Insider
3 days ago
- Business
- Business Insider
Arista Networks (ANET) Receives a Buy from Evercore ISI
Evercore ISI analyst Amit Daryanani maintained a Buy rating on Arista Networks (ANET – Research Report) yesterday and set a price target of $105.00. The company's shares closed yesterday at $89.68. Confident Investing Starts Here: Easily unpack a company's performance with TipRanks' new KPI Data for smart investment decisions Receive undervalued, market resilient stocks right to your inbox with TipRanks' Smart Value Newsletter According to TipRanks, Daryanani is a 5-star analyst with an average return of 12.6% and a 58.61% success rate. Daryanani covers the Technology sector, focusing on stocks such as Apple, Arista Networks, and Amphenol. In addition to Evercore ISI, Arista Networks also received a Buy from William Blair's Sebastien Naji in a report issued on June 16. However, on June 11, Exane BNP Paribas downgraded Arista Networks (NYSE: ANET) to a Hold. Based on Arista Networks' latest earnings release for the quarter ending March 31, the company reported a quarterly revenue of $2 billion and a net profit of $813.8 million. In comparison, last year the company earned a revenue of $1.57 billion and had a net profit of $637.7 million
Yahoo
4 days ago
- Business
- Yahoo
Arista vs. Juniper: Which Cloud Networking Stock Has More Upside?
Arista Networks, Inc. ANET and Juniper Networks, Inc. JNPR are two of the leading players in the global networking industry. Arista offers one of the broadest product lines of data center and campus Ethernet switches and routers in the industry. It provides routing and switching platforms with industry-leading capacity, low latency, port density and power efficiency. On the other hand, Juniper provides networking solutions and communication devices that help build network infrastructure. It offers routers, Ethernet switches and security products for intrusion detection, prevention and wide-area network optimization platforms. The company has also introduced new features within its AI-driven enterprise portfolio, enabling customers to simplify the rollout of their campus wired and wireless networks while providing greater insight to network a diversified portfolio of advanced networking solutions for cloud data centers and enterprise environments, along with growing exposure to AI workloads and software-defined networking, both Arista and Juniper have the wherewithal to cater to the evolving demands of business enterprises. Let us delve a little deeper into the companies' competitive dynamics to understand which of the two is relatively better placed in the industry. Arista is witnessing solid demand trends among enterprise customers backed by its multi-domain modern software approach, which is built upon its unique and differentiating foundation, the single EOS (Extensible Operating System) and CloudVision stack. It has introduced new cognitive Wi-Fi software that delivers intelligent application identification, automated troubleshooting and location services. The versatility of Arista's unified software stack across various use cases, including WAN routing and campus and data center infrastructure, sets it apart from other competitors in the industry. In addition to high capacity and easy availability, its cloud networking solutions promise predictable performance and programmability, enabling integration with third-party applications for network management, automation and orchestration. The company boasts a comprehensive portfolio with the right network architecture for client-to-campus data center cloud and AI networking. The Arista 2.0 strategy is resonating well with customers, with its modern networking platforms being foundational for transformation from silos to centers of data. The strategy comprises three components that are likely to drive growth over the next few years. The first component is focused on plans to invest in core businesses by rolling out new solutions and improved AI offerings. Secondly, Arista aims to emphasize more on software-as-a-service for improved revenue visibility. Last but not least, the company plans to enter adjacent markets to target a broader customer Arista remains plagued by high operating costs. Total operating expenses in first-quarter 2025 increased around 22.3% to to $417.3 million, owing to a rise in headcount, new product introduction costs and higher variable compensation expenditures. Moreover, the redesigning of products and their supply chain mechanism has eroded margins. Although the company is witnessing increased demand, there are lingering supply bottlenecks for advanced products. Therefore, it is increasing orders for these components and trying to build up inventory, which is blocking working capital. Juniper is leveraging the 400-gig cycle to capture hyperscale switching opportunities inside the data center. The company is set to capitalize on the increasing demand for data center virtualization, cloud computing and mobile traffic packet/optical convergence. It offers suites of products such as the T4000 core router, QFX data center platform, ACX and PTX packet/optical solution, among others. With the growing usage of smartphones and tablets, mobile data traffic has gone up. This has resulted in growing demand for advanced networking architecture, in turn leading service providers to spend more on routers and switches. Juniper is expected to benefit from the higher spending pattern among carriers to upgrade their networks and support the incremental growth in data is taking significant steps to enhance the adoption of its AI-Native Networking Platform through the introduction of its Blueprint for AI-Native Acceleration. This comprehensive framework is designed to simplify and accelerate the deployment and utilization of AI-driven networking solutions, benefiting enterprises across various sectors. By leveraging Juniper's AI-Native Networking Platform, organizations can expect up to an 85% reduction in operational expenses and a 90% decrease in network trouble tickets. The platform's industry-leading AIOps technology is key to delivering these results, providing reliable, measurable and secure connections across all devices and applications. The Blueprint for AI-Native Acceleration further enhances these capabilities, enabling customers to achieve up to nine times faster deployments. However, Juniper faces severe competition in each of its served markets, especially from industry leader Cisco Systems, Inc. CSCO, which has traditionally spearheaded innovation, charging higher prices for its premium branded products and expanding margins. It is worth mentioning that Cisco's acquisition of cybersecurity solutions provider Sourcefire could be an added pressure on Juniper's security business. Despite having a strong security portfolio (SRX Platform & Security Software, Screen OS and other Legacy products), Juniper has not been performing well for the past few quarters due to lower-than-expected demand for non-Junos-based security products. Poor performance by the Junos business prompted the company to sell off the mobile security unit. The Zacks Consensus Estimate for Arista's 2025 sales and EPS implies year-over-year growth of 18.7% and 12.8%, respectively. EPS estimates have been trending northward over the past 60 days. Image Source: Zacks Investment Research The Zacks Consensus Estimate for Juniper's 2025 sales implies year-over-year growth of 6.9%, while that for EPS suggests an improvement of 20.9%. EPS estimates have remained static over the past 60 days. Image Source: Zacks Investment Research Over the past year, Arista has gained 8.6% compared with the industry's growth of 34.4%. Juniper has inched up 0.7% over the same period. Image Source: Zacks Investment Research Juniper looks more attractive than Arista from a valuation standpoint. Going by the price/earnings ratio, Juniper's shares currently trade at 16.72 forward earnings, significantly lower than 33.78 for Arista. Image Source: Zacks Investment Research Arista carries a Zacks Rank #2 (Buy), while Juniper sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today's Zacks #1 Rank stocks companies expect their sales and profits to improve in 2025. Arista has shown steady revenue and EPS growth for years, while Juniper has been facing a bumpy road. However, with a superior Zacks Rank and attractive valuation metrics, Juniper appears to hold a slight edge over Arista at the moment, making it a relatively better investment proposition between the two. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Cisco Systems, Inc. (CSCO) : Free Stock Analysis Report Juniper Networks, Inc. (JNPR) : Free Stock Analysis Report Arista Networks, Inc. (ANET) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
4 days ago
- Business
- Yahoo
Arista Networks (ANET) Exceeds Market Returns: Some Facts to Consider
In the latest trading session, Arista Networks (ANET) closed at $95.09, marking a +2.97% move from the previous day. The stock's performance was ahead of the S&P 500's daily gain of 0.94%. On the other hand, the Dow registered a gain of 0.75%, and the technology-centric Nasdaq increased by 1.52%. Shares of the cloud networking company witnessed a loss of 4.22% over the previous month, trailing the performance of the Computer and Technology sector with its gain of 3.9%, and the S&P 500's gain of 1.67%. Analysts and investors alike will be keeping a close eye on the performance of Arista Networks in its upcoming earnings disclosure. The company is predicted to post an EPS of $0.65, indicating a 25% growth compared to the equivalent quarter last year. Alongside, our most recent consensus estimate is anticipating revenue of $2.11 billion, indicating a 24.67% upward movement from the same quarter last year. For the entire fiscal year, the Zacks Consensus Estimates are projecting earnings of $2.56 per share and a revenue of $8.31 billion, representing changes of +12.78% and +18.72%, respectively, from the prior year. Any recent changes to analyst estimates for Arista Networks should also be noted by investors. These recent revisions tend to reflect the evolving nature of short-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the business outlook. Our research reveals that these estimate alterations are directly linked with the stock price performance in the near future. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system. The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. The Zacks Consensus EPS estimate remained stagnant within the past month. Arista Networks presently features a Zacks Rank of #2 (Buy). Looking at its valuation, Arista Networks is holding a Forward P/E ratio of 36.09. This represents a premium compared to its industry average Forward P/E of 27.36. Meanwhile, ANET's PEG ratio is currently 2.44. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. As of the close of trade yesterday, the Internet - Software industry held an average PEG ratio of 2.2. The Internet - Software industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 52, putting it in the top 22% of all 250+ industries. The strength of our individual industry groups is measured by the Zacks Industry Rank, which is calculated based on the average Zacks Rank of the individual stocks within these groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1. Ensure to harness to stay updated with all these stock-shifting metrics, among others, in the next trading sessions. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Arista Networks, Inc. (ANET) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research
