If there has been one positive trend over the past couple of years that has helped tech investors, it has been the steady increase in information technology (IT) spending. With dollars flowing towards 100 Gigabit Ethernet data center switching, next generation security, 100G optical and cloud services, the top companies are continuing to benefit.
In a new report, the analysts at Deutsche Bank focus on three top stocks to buy that may also provide investors with a more aggressive bent on a solid summer trade. All are rated Buy at the firm.
This company went public last June and has continued to be one of the hot tech IPO stories of the past year. Arista Networks Inc. (NYSE: ANET) delivers software-driven cloud networking solutions for large data center and computing environments. In addition, the company’s 10/40/100 Gigabit Ethernet switches offer scalability and performance, and it has over 2,700 customers and more than 2 million cloud networking ports deployed worldwide. At the core of Arista’s platform is EOS, an advanced network operating system. Arista Networks products are available worldwide through distribution partners, systems integrators and resellers.
Many on Wall Street think that the company could benefit from dual supplier requirements at the Web 2.0 and cloud portals and think Arista could see upside to the lofty 30% compound annual growth rate (CAGR) currently forecast. The Deutsche Bank team sees little risk to second- or third-quarter expectations, and they see the company meaningfully benefiting from the 100 GE switching refresh cycle at major Web 2.0 and cloud portals, including Microsoft Azure and Bing Search.
The Deutsche Bank price target for the stock is $95. The Thomson/First Call consensus estimate is $91.33. Shares closed most recently at $79.85.