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Can Higher Service Revenues Boost Arista's (ANET) Q2 Earnings?
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Arista Networks, Inc. (ANET - Free Report) is scheduled to report second-quarter 2024 results on Jul 30, after the closing bell. In the last reported quarter, the company reported an earnings surprise of 14.37%.
The company is expected to have registered higher revenues from the Service segment, driven by healthy demand trends. Management’s effort to expand its portfolio to cater to advanced use cases is a positive.
Factors at Play
In the second quarter, Arista introduced the Multi-Domain Segmentation Service to improve enterprise zero trust networking infrastructure. In the modern IT landscape, characterized by remote work, IoT devices and multi-cloud applications have created a dynamic and unpredictable attack surface. However, legacy security perimeter are ineffective to prevent unauthorized access as they are not optimized to protect against all lateral movements within the network.
Arista’s advanced micro-segmentation solution effectively addresses the operational complexities and interoperability issues of legacy systems and simplifies the implementation of zero-trust security across enterprise environments. This is likely to have had a favorable impact on net sales in the Service segment.
For the June Quarter, the Zacks Consensus Estimate for Service revenues is pegged at $250.39 million, indicating growth from $197.39 billion in the year-ago quarter.
The Zacks Consensus Estimate for total revenues for the company stands at $1.64 billion. It generated revenues of $1.46 billion in the prior-year quarter. The consensus mark for earnings is currently pegged at $1.94 per share, indicating solid growth from $1.58 in the year-earlier quarter.
Earnings Whispers
Our proven model predicts a likely earnings beat for Arista for the second quarter. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. This is perfectly the case here.
Earnings ESP: Earnings ESP, which represents the difference between the Most Accurate Estimate and the Zacks Consensus Estimate, is +1.72%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Arista currently sports a Zacks Rank #1.
Other Stocks to Consider
Here are some other companies you may want to consider, as our model shows that these, too, have the right combination of elements to post an earnings beat this season:
The Earnings ESP for Advanced Micro Devices (AMD - Free Report) is +2.21%, and it has a Zacks Rank of 3 at present. The company is scheduled to report quarterly numbers on Jul 30.
The Earnings ESP for Silicon Motion Technology Corporation (SIMO - Free Report) is +2.32%, and it has a Zacks Rank of 3 at present. The company is scheduled to report quarterly numbers on Aug 1.
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Can Higher Service Revenues Boost Arista's (ANET) Q2 Earnings?
Arista Networks, Inc. (ANET - Free Report) is scheduled to report second-quarter 2024 results on Jul 30, after the closing bell. In the last reported quarter, the company reported an earnings surprise of 14.37%.
The company is expected to have registered higher revenues from the Service segment, driven by healthy demand trends. Management’s effort to expand its portfolio to cater to advanced use cases is a positive.
Factors at Play
In the second quarter, Arista introduced the Multi-Domain Segmentation Service to improve enterprise zero trust networking infrastructure. In the modern IT landscape, characterized by remote work, IoT devices and multi-cloud applications have created a dynamic and unpredictable attack surface. However, legacy security perimeter are ineffective to prevent unauthorized access as they are not optimized to protect against all lateral movements within the network.
Arista’s advanced micro-segmentation solution effectively addresses the operational complexities and interoperability issues of legacy systems and simplifies the implementation of zero-trust security across enterprise environments. This is likely to have had a favorable impact on net sales in the Service segment.
For the June Quarter, the Zacks Consensus Estimate for Service revenues is pegged at $250.39 million, indicating growth from $197.39 billion in the year-ago quarter.
The Zacks Consensus Estimate for total revenues for the company stands at $1.64 billion. It generated revenues of $1.46 billion in the prior-year quarter. The consensus mark for earnings is currently pegged at $1.94 per share, indicating solid growth from $1.58 in the year-earlier quarter.
Earnings Whispers
Our proven model predicts a likely earnings beat for Arista for the second quarter. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. This is perfectly the case here.
Earnings ESP: Earnings ESP, which represents the difference between the Most Accurate Estimate and the Zacks Consensus Estimate, is +1.72%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Arista Networks, Inc. Price and EPS Surprise
Arista Networks, Inc. price-eps-surprise | Arista Networks, Inc. Quote
Zacks Rank: Arista currently sports a Zacks Rank #1.
Other Stocks to Consider
Here are some other companies you may want to consider, as our model shows that these, too, have the right combination of elements to post an earnings beat this season:
Pinterest (PINS - Free Report) has an Earnings ESP of +7.14% and a Zacks Rank #3 at present. It is set to release quarterly numbers on Jul 30. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Earnings ESP for Advanced Micro Devices (AMD - Free Report) is +2.21%, and it has a Zacks Rank of 3 at present. The company is scheduled to report quarterly numbers on Jul 30.
The Earnings ESP for Silicon Motion Technology Corporation (SIMO - Free Report) is +2.32%, and it has a Zacks Rank of 3 at present. The company is scheduled to report quarterly numbers on Aug 1.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.