2024-03-27 01:32:01 ET
Summary
- Arista Networks' stock has surged by over 79% in the last year, part of this because of the AI hype.
- It is important to assess whether there are related sales opportunities, and for this purpose, differentiating between traditional and Generative AI is key.
- ANET is benefiting from supply chain normalization but faces low demand visibility for its data center products which constitutes uncertainty for 2024.
- With its ability to rapidly evolve into a platform-oriented company also offering security services, it could also adapt to harvest a $750 million AI training networking opportunities.
- It is preferable to first see real progress in Ethernet-based AI versus Nvidia's proprietary InfiniBand.
Since I covered Arista Networks ( ANET ) in November 2023, the stock has surged by over 40%, while I had a neutral position mainly based on the normalization of supply chains which could result in pricing pressures. Also, as charted below, the stock has progressed by more than 79% during the last year to reach $303.14, outperforming the Invesco QQQ ETF ( QQQ ) by more than 35%....
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Arista Networks: AI Prospects Emerging But Will Take Time To Materialize