Strong Q3 Performances: Arista Networks and Fortinet Shine Amid Market Boost
Several standout tech stocks are making headlines this trading week after exceeding Q3 expectations. Arista Networks and Fortinet have particularly caught investor attention following their impressive financial results.
With a post-election market lift and a recent 25 basis points rate cut by the Federal Reserve, investors are keen to look at these companies.
Arista Networks – ANET
Zacks Rank #1 (Strong Buy)
Arista Networks ANET is thriving in the cloud services sector, with its stock price increasing by over +70% this year, and +200% over the past two years.
Despite a recent -7% drop on Friday, attributed to profit-taking after earnings, the company’s consistent earnings triumph since going public in 2014 suggests potential for better buying opportunities.
For Q3, Arista reported an EPS of $2.40, surpassing expectations of $2.09 by 15% and growing 31% from $1.83 the previous year.
The company’s Q3 revenue stood at $1.81 billion, a 20% increase year-over-year, beating estimates of $1.75 billion. It has exceeded revenue forecasts for 20 successive quarters, driven by heightened demand for its AI-driven cloud networking solutions.
Additionally, Arista’s new partnership with Meta META to enhance AI capabilities may further bolster its growth trajectory.
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Fortinet – FTNT
Zacks Rank #2 (Buy)
Fortinet’s FTNT stock rose +8% recently after posting a Q3 EPS of $0.63, well above estimates of $0.51, marking a 53% increase from $0.41 a share year-over-year.
The company enjoyed sales of $1.5 billion, slightly surpassing estimates of $1.47 billion, with a year-over-year growth of 13%. Investors are pleased with Fortinet’s record gross margins at 83.2% and operating margins at 36.1%, prompting the company to revise its revenue and margin guidance upward.
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The Bottom Line
With a favorable inflationary outlook, the strong performances of Arista Networks and Fortinet in Q3 make them compelling stocks to monitor moving forward.
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Fortinet, Inc. (FTNT): Free Stock Analysis Report
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
