2024-06-11 10:00:32 ET
Summary
- ANET benefits from the generative AI boom and supplies AI Ethernet switching/routing platforms and advanced network operating stack to hyperscalers and cloud-based enterprise customers.
- Most importantly, with META and MSFT each accounting for over 10% of its revenues, it is undeniable that ANET is likely to continue reporting robust top/ bottom lines ahead.
- The same has been observed in ANET's FQ1'24 earnings results and FQ2'24 guidance, further aided by the growing multi-year backlog and extremely healthy balance sheet.
- This is why the market has awarded the stock with extreme price rallies and premium valuations, with it now considered expensive compared to its peers.
- With a minimal margin of safety, as insiders continue to cash out, it may be more prudent to wait for a deep pullback before adding.
ANET's Investment Thesis Appears Robust, Thanks To Generative AI Infrastructure Boom
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