- Arista announced better than expected performance in the first quarter.
- Citigroup has an optimistic outlook on Arista Network.
- The massive support level stands at $100.
Arista Network reported first-quarter earnings that exceeded expectations. Jim Suva, a Citigroup analyst, allotted a ‘buy’ rating on ANET shares. That stock trades under the NYSE: ANET ticker.
CitiGroup Optimistic on Arista Networks
Arista Network unveiled its impressive first-quarter performance on Monday. Its overall revenue noted a 31.4% Y/Y increase to $877.07 million, whereas the Q1 non-GAAP EPS stood at $0.84 (beating by $0.03).
Total revenue surged well past the previous guidance, while the company benefits from lower marketing expenses and COVID-driven travels. The first-quarter gross market stood at 63.9%. Meanwhile, operating expenses hovered at 4225.3 million (25.7% of the total revenue).
Arista Networks bought $136.2M of its common stock in Q1 (at a $116 average price per share). Moreover, the firm’s management revealed that future repurchase amounts would depend on market conditions.
The company updates financial guidance for its 2nd fiscal quarter, expecting its total revenue between $950 million and $1 billion range, including about $50M of cloud-associated deferred revenue. Meanwhile, the non-GAAP gross margin needs to be between 60% and 62%, despite Arista continuing to invest in marketing and R&D. Arista Networks CEO Ita Brennan stated that demand remains strong in 2022.
Citigroup’s analyst Jim Suva stated that Arista gains market share from Cisco. The analysts assigned the ANET stock a buy rating with $160 as the price target. Though the company is in a lucrative position to flourish, the $34.2 billion market cap shows the firm is yet to exhibit undervalued conditions. Therefore, the reward/risk ratio is not impressive for ‘value’ market players.
Massive Foothold at $100
ANETA stock has enormous support at $100, whereas the initial resistance stands at $130. Dropping beneath $100 would present a ‘sell’ signal, opening the path to $90 and even lower. Meanwhile, a jump beyond $130 will target the level at $140.
Arista Network announced Q1 results that exceeded expectations. Citigroup analyst Jim Suva allocated a ‘buy’ rating on ANETA share. Nevertheless, it might not be the time to purchase the share. If the US stock market sees a more substantial correction, the stock might drop lower.
Editorial credit: madamF / shutterstock.com
The information provided on this website should not be interpreted as financial or investment guidance and may not embody the perspectives of Forex Tools Trader or its contributors. Forex Tools Trader does not hold responsibility for any financial setbacks experienced due to the use of information provided on this website by its writers or patrons. It's essential to thoroughly investigate and make informed decisions before entering any financial commitments, particularly concerning third-party reviews, presales, and similar ventures. The content you are viewing may be sponsored content, read our full disclaimer to learn more.