DELL - Arista: Buy This Key Data Center Supplier

2024-05-03 08:36:37 ET

Summary

• Arista Networks is a key supplier of efficient switches for data centers and hyperscalers like AWS and Azure.
• ANET has outperformed the market and most peers, with over 30% EPS growth since its IPO in 2014.
• Hyperscaler capex growing 55% to meet AI data demand is positive for ANET.
• High margins produce free cash flow that provides for further growth options or share buybacks.
• Consensus valuation on YE25 EPS points to a US$373 price target at 2.5x PEG.

Summary

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