Latest news with #EOS
Yahoo
15-05-2025
- Business
- Yahoo
Arista Rises 18.8% in a Year: Should You Bet on the Stock Now?
Arista Networks, Inc. ANET has increased 18.8% over the past year compared with the communication components industry's growth of 40.5%. The stock has outperformed the Zacks Computer & Technology sector and the S&P 500's growth of 11.9% and 11.2%, respectively. Image Source: Zacks Investment Research The company has outperformed its peer, Juniper Networks, Inc. JNPR, but underperformed relative to Cisco Systems, Inc. CSCO. Juniper has gained 4.5%, while Cisco has surged 34.1% during this period. Arista is steadily expanding its portfolio to match the ever-growing demand for modern AI infrastructure. It is witnessing solid demand among enterprise customers backed by its multi-domain modern software approach, which is built upon its unique and differentiating foundation, the single EOS (Extensible Operating System) and CloudVision stack. It has introduced Cluster Load Balancing, a sophisticated network load-balancing solution integrated into Arista EOS. The solution streamlines the management of large flows of data across network latest Arista Etherlink AI Platforms are capable of supporting ultra-fast data rates (800G/400G). It can efficiently support small AI clusters as well as large deployments with 100,000+ accelerators. NVIDIA's NVDA GPU roadmap focuses on pushing the boundaries of high-performance computing and supporting data centers with next-generation capabilities. NVIDIA's upcoming Blackwell Ultra GPUs are likely to provide up to 25X the token throughput for AI inference compared to Hopper 100. To connect these GPUs in AI clusters, enterprises need networks with ultra-low latency and extremely high throughput. Arista is actively aligning its innovation strategy with such emerging technology trends. Backed by strong momentum in cloud and AI networking solutions, the company is expected to generate $750 million in front-end AI revenues in 2025. In the first quarter, Arista generated net cash flow of $641.7 million from operations, up from $513.8 million a year ago. Healthy growth in cash flow indicates efficient working capital management. As of March 31, 2025, the company had $1.84 billion in cash and cash equivalents and $257.8 million in other long-term liabilities. At the end of the first quarter of 2025, ANET reported a current ratio of 3.93, way above the industry's average of 1.48. A current ratio above 1 suggests that a company is well-positioned to meet its short-term obligations. Such a strong liquidity position will allow Arista to steadily invest in growth initiatives and expand opportunities across several end markets. Growing geopolitical and trade uncertainty remains a major concern for Arista. The recent decision by the United States and China to temporarily reduce reciprocal tariffs for a period of 90 days is a positive. However, if the countries fail to reach a resolution and tariffs are imposed again, this will have a negative impact on Arista's gross margin. Amid such uncertainty, the company has ramped up its inventory to create a supply chain buffer. This reduces the availability of capital for strategic investments as a higher part of the capital is locked in the company is facing intense competition from Cisco in the cloud network solution market. In the network equipment market, Juniper is a major competitor. To fend off the competition, the company has to steadily invest in enhancing its existing product line and developing new technologies. This is weighing on the margin. In the first quarter of 2025, total operating expenses were $417.3 million, up from $341.2 million in the year-ago quarter. Research & development costs rose to $266.4 million from $208.4 million. Image Source: Zacks Investment Research ANET is currently witnessing an uptrend in estimate revisions. Earnings estimates for 2025 have jumped 3.64% to $2.56 over the past 60 days, while the same for 2026 has increased 1.73% to $2.94. The positive estimate revision portrays bullish sentiments about the stock's growth potential. Image Source: Zacks Investment Research The company is aiming to become the core network backbone for next-generation AI clusters. Arista is placing strong emphasis on expanding its Etherlink portfolio and developing cutting-edge features focused on maximizing AL cluster efficiency. NVIDIA's GPU roadmap presents a solid growth opportunity for the company. Strong balance sheet and healthy growth in cash flow are positive factors. Upward estimate revision underscores growing investors' rising operating expenses and fierce competition are weighing on the bottom line. Sino-U.S. trade uncertainty remains a major concern. Despite some near-term challenges, Arista is poised to gain from solid AI traction, and investors are likely to profit in the long run if they bet on this stock delivered a trailing four-quarter average earnings surprise of 11.82%. Arista currently carries a Zacks Rank #2 (Buy). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Cisco Systems, Inc. (CSCO) : Free Stock Analysis Report Juniper Networks, Inc. (JNPR) : Free Stock Analysis Report NVIDIA Corporation (NVDA) : Free Stock Analysis Report Arista Networks, Inc. (ANET) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
15-05-2025
- Business
- Yahoo
1 Stock-Split AI Stock Up 2,330% Since 2015 to Buy Now, According to Wall Street
Arista shares have declined 12% since announcing a 4-for-1 stock split in November, but stocks have returned an average of 25% during the year following such announcements. The company is the market leader in high-speed Ethernet switches, and demand for its products should increase as more businesses build out artificial intelligence (AI) infrastructure. Wall Street expects Arista's earnings to increase at 16% annually through 2028, but the company has consistently beat the consensus estimate in recent quarters. 10 stocks we like better than Arista Networks › Arista Networks (NYSE: ANET) stock has soared 2,330% since January 2015. But shares have declined 12% since the company announced a 4-for-1 stock split on Nov. 7. Investors have two reasons to think the price is headed higher in the coming months. First, since 1980, companies have seen their share prices increase by an average of 25% during the year after a stock split announcement, according to Bank of America. Second, Wall Street anticipates healthy returns for Arista shareholders during the next year. The average 12-month target price is $108 per share, which implies 13% upside from its current share price of $95. Here's what investors should know about this artificial intelligence (AI) stock. Arista specializes in high-performance networking solutions for enterprise campus and cloud data centers. The company complements its hardware portfolio, including switches and routers, with adjacent software for network automation, monitoring, and security. Research company Gartner recently recognized Arista as the technology leader in data center switches. The report highlighted its consistent innovation, product roadmap, and network management software as key strengths. Arista has differentiated itself with its Extensible Operating System (EOS). Whereas Cisco deploys multiple operating systems across different devices, making network management more complicated, Arista EOS runs across its entire product portfolio, letting customers deploy a seamless network that spans public, private, and hybrid clouds. Importantly, Arista dominates the high-speed Ethernet switch market, meaning switches that transfer data at 100-plus gigabits per second. The company captured about 43% market share last year, three times more than its closest competitor Cisco. Leadership in that segment means Arista is well positioned to benefit as AI creates demand for faster networking solutions. A data center network has two distinct components: the front end and back end. The front end of a network moves traffic between endpoint (user-facing) devices and servers, while the back end of a network moves traffic between servers. At present, Ethernet is the industry standard in front-end networking for AI workloads, while InfiniBand is the industry standard in back-end networking for AI workloads. However, Arista expects Ethernet switches to become an increasingly popular choice for back-end networks in the coming years. "We naturally see the deployment of more back-end clusters resulting in more uniform compute, storage, and memory," CEO Jayshree Ullal told analysts last year. That puts Arista in front of a large market opportunity. Bloomberg estimates AI-related Ethernet switch sales for front-end and back-end networks will grow at 41% annually and 51% annually, respectively, through 2028. In that scenario, cumulative spending in those areas would exceed $9 billion in three years. Comparatively, Arista estimates AI sales will total $1.5 billion in 2025. That figure could double or even triple by 2028 because the company dominates the Ethernet switch space. Wall Street estimates Arista's earnings will increase at 16% annually through 2028. That makes the current valuation of 38 times earnings look somewhat expensive. However, analysts have consistently underestimated the company. Arista topped the consensus earnings estimate by an average of 14% in the last six quarters. And that trend may continue as demand for AI networking increases. Importantly, Arista stock closed near $108 per share on Nov. 7, the day the company announced its 4-for-1 stock split. History says the share price will advance 25% to $135 during the subsequent year, which implies 42% upside from its current share price of $95. But that may be unrealistic, given the economic uncertainty created by President Trump's tariffs. However, patient investors should consider buying a small position in this AI stock today. Before you buy stock in Arista Networks, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and Arista Networks wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $598,613!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $753,878!* Now, it's worth noting Stock Advisor's total average return is 922% — a market-crushing outperformance compared to 169% for the S&P 500. Don't miss out on the latest top 10 list, available when you join . See the 10 stocks » *Stock Advisor returns as of May 12, 2025 Bank of America is an advertising partner of Motley Fool Money. Trevor Jennewine has positions in Arista Networks. The Motley Fool has positions in and recommends Arista Networks, Bank of America, and Cisco Systems. The Motley Fool recommends Gartner. The Motley Fool has a disclosure policy. 1 Stock-Split AI Stock Up 2,330% Since 2015 to Buy Now, According to Wall Street was originally published by The Motley Fool Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Business Times
13-05-2025
- Business
- Business Times
Carriers moving MRO work outside China even before tariff chaos: SIA Engineering
[SINGAPORE] There has been little to no impact from tariffs on SIA Engineering Company's (SIAEC) operations for now, but these are still early days, said chief executive officer Chin Yau Seng in a briefing on Tuesday (May 13). It has been just 42 days since the 'Liberation Day' tariffs were launched and the company is monitoring the tariffs and their impact. SIAEC will be looking into the structure of contracts with the view of passing on the costs to its customers. 'We are monitoring the situation, I think no one really knows how all these things will finally play out in what form,' he said. As the tariffs have yet to make a price impact, SIAEC has yet to see airlines moving their maintenance, repair and overhaul (MRO) work in China to other Asian markets. But carriers have been seeking to diversify their MRO bases overseas even before the tariffs, said Chin. 'We have been in conversation with some of them over the course of the past few years, we do have US carriers among our customers, so perhaps that's one opportunity, but we will continue conversations to see where they take us,' he said. For financial year 2025 ended Mar 31, the increase in SIAEC's expenditure was driven mainly by material and subcontract costs. Material costs have increased 32.8 per cent to S$272 million for FY2025 from S$204.8 million in FY2024. Subcontract costs have increased 36.6 per cent on the year to S$150.1 million from S$105.9 million. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up While material costs are passed through to customers, subcontract costs might not be passed through to customers depending on the contract. While material costs have been affected by inflation and supply chain issues, the rise in subcontract costs stems from the increase in volume and a rate increase that occurred in FY2025. 'We've taken the hit this past financial year, but going forward, we've locked in the contract for the three years, if there was one big jump it was in the past year already,' said Chin. Looking ahead, SIAEC is implementing a new enterprise operating system (EOS), which will increase efficiency and consistency across its MRO operations. With demand from airlines maxing out the capacity at the company's hangars, this EOS is expected to aid in forecasting and planning to eke out spare capacity to sell, among other improvements. SIAEC will work closely with its customers as part of the EOS to plan for aircraft checks. From the predictability of check induction to the availability of spares, these are some factors the EOS will consider in ensuring that the company can be more efficient in delivery timelines for maintenance checks. 'The more predictable you are, the better you are in knowing there's spare capacity that's freed up that you can sell, that will translate to revenue,' said Chin. As airlines operate their aircraft for longer, SIAEC will be leveraging its knowledge gained from maintaining airframes such as the A350 and A380, as well the Boeing 787 and 777. The company has moved up the learning curve, with Chin pointing out that the A350 checks go out on a timely basis. 'You're actually getting deeper and deeper into the aircraft life cycle and therefore you expect to have a higher work content and more things to do on the ground, and that we will continue to be at the forefront to try keep developing capabilities and making sure we are among the best MROs handling these aircraft,' he said.
Business Times
13-05-2025
- Business
- Business Times
Little to no tariff impact for now: SIA Engineering
[SINGAPORE] There has been little to no impact from tariffs on SIA Engineering Company's (SIAEC) operations for now, but these are still early days, said chief executive officer Chin Yau Seng in a briefing on Tuesday (May 13). It has been just 42 days since the 'Liberation Day' tariffs were launched and the company is monitoring the tariffs and their impact. SIAEC will be looking into the structure of contracts with the view of passing on the costs to its customers. 'We are monitoring the situation, I think no one really knows how all these things will finally play out in what form,' he said. As the tariffs have yet to make a price impact, SIAEC has yet to see airlines moving their maintenance, repair and overhaul (MRO) work in China to other Asian markets. But carriers have been seeking to diversify their MRO bases overseas even before the tariffs, said Chin. 'We have been in conversation with some of them over the course of the past few years, we do have US carriers among our customers, so perhaps that's one opportunity, but we will continue conversations to see where they take us,' he said. For financial year 2025 ended Mar 31, the increase in SIAEC's expenditure was driven mainly by material and subcontract costs. Material costs have increased 32.8 per cent to S$272 million for FY2025 from S$204.8 million in FY2024. Subcontract costs have increased 36.6 per cent on the year to S$150.1 million from S$105.9 million. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up While material costs are passed through to customers, subcontract costs might not be passed through to customers depending on the contract. While material costs have been affected by inflation and supply chain issues, the rise in subcontract costs stems from the increase in volume and a rate increase that occurred in FY2025. 'We've taken the hit this past financial year, but going forward, we've locked in the contract for the three years, if there was one big jump it was in the past year already,' said Chin. Looking ahead, SIAEC is implementing a new enterprise operating system (EOS), which will increase efficiency and consistency across its MRO operations. With demand from airlines maxing out the capacity at the company's hangars, this EOS is expected to aid in forecasting and planning to eke out spare capacity to sell, among other improvements. SIAEC will work closely with its customers as part of the EOS to plan for aircraft checks. From the predictability of check induction to the availability of spares, these are some factors the EOS will consider in ensuring that the company can be more efficient in delivery timelines for maintenance checks. 'The more predictable you are, the better you are in knowing there's spare capacity that's freed up that you can sell, that will translate to revenue,' said Chin. As airlines operate their aircraft for longer, SIAEC will be leveraging its knowledge gained from maintaining airframes such as the A350 and A380, as well the Boeing 787 and 777. The company has moved up the learning curve, with Chin pointing out that the A350 checks go out on a timely basis. 'You're actually getting deeper and deeper into the aircraft life cycle and therefore you expect to have a higher work content and more things to do on the ground, and that we will continue to be at the forefront to try keep developing capabilities and making sure we are among the best MROs handling these aircraft,' he said.
Yahoo
13-05-2025
- Business
- Yahoo
The past five years for Electro Optic Systems Holdings (ASX:EOS) investors has not been profitable
Electro Optic Systems Holdings Limited (ASX:EOS) shareholders should be happy to see the share price up 16% in the last month. But will that repair the damage for the weary investors who have owned this stock as it declined over half a decade? Probably not. Five years have seen the share price descend precipitously, down a full 74%. While the recent increase might be a green shoot, we're certainly hesitant to rejoice. The fundamental business performance will ultimately determine if the turnaround can be sustained. So let's have a look and see if the longer term performance of the company has been in line with the underlying business' progress. AI is about to change healthcare. These 20 stocks are working on everything from early diagnostics to drug discovery. The best part - they are all under $10bn in marketcap - there is still time to get in early. Electro Optic Systems Holdings isn't currently profitable, so most analysts would look to revenue growth to get an idea of how fast the underlying business is growing. When a company doesn't make profits, we'd generally hope to see good revenue growth. That's because fast revenue growth can be easily extrapolated to forecast profits, often of considerable size. In the last half decade, Electro Optic Systems Holdings saw its revenue increase by 2.9% per year. That's far from impressive given all the money it is losing. It's not so sure that share price crash of 12% per year is completely deserved, but the market is doubtless disappointed. While we're definitely wary of the stock, after that kind of performance, it could be an over-reaction. We'd recommend focussing any further research on the likelihood of profitability in the foreseeable future, given the muted revenue growth. The graphic below depicts how earnings and revenue have changed over time (unveil the exact values by clicking on the image). This free interactive report on Electro Optic Systems Holdings' balance sheet strength is a great place to start, if you want to investigate the stock further. Investors in Electro Optic Systems Holdings had a tough year, with a total loss of 13%, against a market gain of about 8.8%. Even the share prices of good stocks drop sometimes, but we want to see improvements in the fundamental metrics of a business, before getting too interested. Unfortunately, longer term shareholders are suffering worse, given the loss of 12% doled out over the last five years. We would want clear information suggesting the company will grow, before taking the view that the share price will stabilize. It's always interesting to track share price performance over the longer term. But to understand Electro Optic Systems Holdings better, we need to consider many other factors. Consider for instance, the ever-present spectre of investment risk. We've identified 1 warning sign with Electro Optic Systems Holdings , and understanding them should be part of your investment process. For those who like to find winning investments this free list of undervalued companies with recent insider purchasing, could be just the ticket. Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on Australian exchanges. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Sign in to access your portfolio
