Growth stocks are attractive to many investors, as above-average financial growth helps these stocks easily grab the market's attention and produce exceptional returns. But finding a growth stock that can live up to its true potential can be a tough task.That's because, these stocks usually carry above-average risk and volatility. In fact, betting on a stock for which the growth story is actually over or nearing its end could lead to significant loss.However, it's pretty easy to find cutting-edge growth sto ...

Sundry Photography I recommended Arista Networks (NYSE:ANET) in May 2023, for around $160. The price has more than doubled since then but is about 6% below its all-time high of $376. The stock has been insanely successful in the past year, with a return of 95%, and in the past decade with a return of 1,779%. Is it still worth buying at 41x earnings and 16x sales? I believe so, it is easily one of the best positioned for Hyperscalers, Cloud Service Providers, and other high-performance low latency network ...

After a slew of artificial intelligence stocks decided to split their stocks, these three could be next.The past few months have seen a bunch of artificial intelligence (AI)-related technology companies announce stock splits. In fact, of the five potential AI stock splits I wrote about back in May, four have already either executed or announced imminent splits. Remember, a stock split doesn't change the intrinsic value of a stock one iota. But it can open up the stock to more retail investors and/or employe ...

Arista Networks, Inc. (ANET) was recently selected by the Alabama Fiber Network (“AFN”), a consortium of eight electric cooperatives, to provide routing and switching equipment for the robust middle-mile network project throughout underserved rural areas across the region. The $340 million investment includes the deployment of Arista's high-performance 7280SR3 platform for seamless connectivity across diverse locations.In addition to a scalable and adaptable architecture, the platform offers robust automati ...

When the stock market gets choppy, it's time to look for bargains.The stock market has been booming in 2024. Through the end of July, the S&P 500 index was up more than 15%, a stellar performance driven partly by artificial intelligence (AI) mania.It's becoming less clear that the good times will last through the end of the year. Popular AI stocks have taken big hits; a weak U.S. jobs report has fueled concerns about a potential recession; and volatility may be on the rise. The major U.S. stock indices plun ...

Last week, Wall Street witnessed one of the most eventful weeks in 2024. Markets were rattled on Aug 5, following the release of disappointing July payrolls data, reigniting fears that the economy might slip into a recession.However, stocks have recovered most of the losses since then in a dramatic rebound that has greatly fizzled fears of a recession in the near term, following the release of a fresh jobless claims report that came in better than expected.  However, the market volatility is far from over.O ...

Industry Overview - Artificial intelligence (AI) is experiencing significant growth, with 22% of companies aiming to integrate AI into their products and 33% currently utilizing AI applications to enhance service and product delivery [1] - The AI sector is still in its early stages, presenting substantial investment opportunities as various technology applications are being explored [1] Company Analysis: Nvidia (NVDA) - Nvidia has transitioned from a graphics card manufacturer to a leader in AI chip production, with CEO Jensen Huang instrumental in this shift [2] - The stock has appreciated 116.42% year-to-date and 129.52% over the past 12 months, despite a recent decline [2] - Nvidia reported an EPS of $5.98, reflecting a 629% year-over-year increase, and has a trailing P/E ratio of 59.59 [2][3] - The company has a robust buyback program and increased its dividend payout by 150% to $0.10 per share [3] - Over the past five years, Nvidia's stock has risen over 2500%, making it a top AI investment [3] Company Analysis: Arista Networks (ANET) - Arista Networks is a key player in cloud computing and data center software, benefiting from the AI boom due to its ability to manage large data requirements [4] - The stock has gained 39.72% year-to-date and over 80% in the past 12 months, with a nearly 500% increase over the last five years [4][5] - Arista's revenue rose 15.9% in Q2 2024 to $1.69 billion, with a GAAP net income of $665.4 million, up from $491.9 million the previous year [5] - The company has a trailing P/E ratio of 42.69, justified by its strong earnings growth [4][5] Company Analysis: Meta Platforms (META) - Meta Platforms is a major tech company investing heavily in AI, planning to allocate up to $40 billion for research, including AI initiatives [6] - The company reported a net income of $13.47 billion, significantly up from $7.79 billion the previous year, while its stock has risen 42.68% this year and 56% over the last 12 months [6][7] - Meta's financial strength and commitment to AI development position it as a promising investment in the AI sector [7]

Core Viewpoint - High-growth cloud computing stocks are currently trading at significant discounts, presenting potential buying opportunities despite bearish sentiment in the tech sector [1] Group 1: CrowdStrike (CRWD) - CrowdStrike provides cloud-based cybersecurity solutions and has faced challenges due to a software bug causing IT outages, leading to a nearly 40% stock drop in July [2][3] - Despite the setback, analysts have mixed views; Wells Fargo maintains an overweight rating with a reduced price target of $350, while Piper Sandler holds a neutral rating with a $310 target [2] - CrowdStrike's Q1 2025 earnings showed a record net new annual recurring revenue (ARR) growth of 22% year-over-year, with ending ARR at $3.65 billion, but potential lawsuits from affected customers could impact financials [3] Group 2: Nutanix (NTNX) - Nutanix provides cloud computing software for hybrid and multi-cloud deployments, reporting Q3 fiscal 2024 revenue growth of 17% year-over-year to $525 million and a 24% increase in ARR to $1.82 billion [5][6] - The stock has pulled back around 35% from its highs, presenting an attractive entry point, with a forward earnings valuation of 39 times and a forward sales multiple of 5.4 times [5] - Management noted increasing interest from large enterprise customers, although sales cycles are elongating, indicating potential for future growth [6] Group 3: Arista Networks (ANET) - Arista Networks provides cloud networking solutions and reported Q2 2024 revenue growth of 15.9% year-over-year to $1.69 billion, with non-GAAP EPS of $2.10, beating estimates by 16 cents [7] - The stock has seen a 13% pullback from its highs, suggesting a buying opportunity for long-term investors [7] - Collaboration with Nvidia on AI networking positions Arista to benefit from customer AI infrastructure investments by 2025, making it an interesting stock to consider [8]

Investment Rating - The report assigns a strong buy rating for Arista (ANET), expecting it to outperform the benchmark index by over 20% in the next six months [41]. Core Insights - Arista's revenue for FY24Q2 reached $1.69 billion, representing a year-over-year growth of 15.9% and a quarter-over-quarter increase of 7.6%. The non-GAAP gross margin was 65.4%, and diluted earnings per share were $2.08, reflecting a 32.9% increase [6][11][12]. - The company anticipates Q3 revenue to be between $1.72 billion and $1.75 billion, with a non-GAAP gross margin of 63% to 64% and an operating margin of 44% [10][20]. - Arista is focusing on expanding its customer base towards large-scale interconnects, targeting clusters of tens of thousands of cards, with some customers already increasing their GPU counts significantly [11][36]. Summary by Sections 1. Operating Performance for FY24Q2 - Arista reported a total revenue of $1.69 billion, with product revenue at $1.42 billion and service revenue at $267 million. The gross profit was $1.10 billion, leading to a non-GAAP gross margin of 65.4% [6][7][12]. 2. Revenue Breakdown - Revenue by region for FY24Q2 was as follows: Americas at $1.37 billion (81%), Europe, Middle East, and Africa at $179 million (11%), and Asia-Pacific at $137 million (8%). The Americas region saw an increase in revenue share, while the Asia-Pacific region experienced a decline [8][9]. 3. Q3 Guidance - The company expects Q3 revenue to be approximately $1.72 billion to $1.75 billion, with a non-GAAP gross margin of 63% to 64% and an operating margin of 44%. The actual tax rate is projected to be around 21.5% [10][20]. 4. Conference Call Highlights - During the conference call, it was noted that the strong performance in Q2 was driven by robust service and software renewals, which accounted for 17.6% of total revenue. The company has deployed over 100 million ports globally and is investing heavily in R&D, with expenditures reaching $216.7 million [11][12][36].

Core Insights - Several top-rated Zacks stocks have reported strong Q2 earnings, exceeding both top and bottom line expectations, highlighting their potential for further growth [1] Arista Networks (ANET) - Q2 EPS of $2.10 surpassed estimates by 8% and increased 33% from $1.58 in the same quarter last year [2] - Sales reached $1.69 billion, exceeding estimates by 3% and growing 16% year over year from $1.45 billion [2] - ANET has consistently beaten EPS estimates since its IPO in 2014 and is up 47% year to date, outperforming broader indexes and most tech stocks [2] PayPal (PYPL) - Q2 EPS of $1.19 exceeded estimates by 24% and rose 2% from the previous year [3] - Q2 sales totaled $7.85 billion, 1% above expectations and an 8% increase from $7.28 billion a year ago [3] - PayPal raised its EPS guidance for fiscal 2024 and has surpassed earnings expectations for four consecutive quarters with an average EPS surprise of 14% [3] Northern Oil and Gas (NOG) - Q2 EPS of $1.46 exceeded estimates of $1.20 by 21%, despite a decrease from $1.49 in the previous quarter [4] - Sales reached $561.03 million, beating estimates by 4% and increasing 35% from $416.49 million in the same quarter last year [4] - NOG is up 16% year to date, trading at a forward earnings multiple of 7.9X, and offers a 3.94% annual dividend yield, which has been increased 10 times in the last five years [4] Investment Outlook - Following strong Q2 results, these top-rated stocks are expected to see upward revisions in earnings estimates, making them attractive long-term investment opportunities [5]