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Nothing in this video constitutes tax, legal, financial and/or investment advice, nor does any information in this video constitute an invitation and/or solicitation to invest in a particular security. This video merely expresses the author’s opinion and should be viewed as such. Before proceeding with any investments, you should do your own research and seek advice from an independent licensed professional.
The author of this video does NOT accept liability for any investment decisions, as this video is provided only for educational and entertainment purposes. Although the author has endeavored for the information in this video to be correct and accurate, he does NOT assume liability nor does he guarantee that the data will be updated, correct and/or accurate at all times.
In today's video, we're talking about a company which I think has a massive potential. We're talking about Anet A-n-e-t that's the ticker it's called Arista Arista is dominating the high speed data center switch. Market They've taken Cisco's lunch forever and they continue to do so. They have a strong momentum now at 50 billion market cap their Behemoth They have clients all over the place Microsoft Amazon Meta All of them work for them.
Their revenue growth is absolutely insane. 2.3 billion, then 3 billion, then 4.3 billion. Last year they did 5 billion in sales, almost 5 billion sales. They're the market leader in the data center switch category and they're also at the Forefront of the A applications of data centers.
And with the increased spending that we're going to see on cloud computing and data centers and AI driven spending, that's going to happen in this field, this company is going to benefit now. Obviously, there's macro risks here. if the economy goes Kaboom and into the toilet, they'll suffer, but the rest of the market as well. But I'm just saying to you, look, there's big time here.
Total: Supermarket This company has terrific fundamentals very similar to Nvidia and it has similar exposures and similar opportunities. It's not exactly identical to Nvidia they're not competing with Nvidia. In fact, I would call this a completing product if Nvidia does well. and if this industry goes into the stratosphere, Arista is going to benefit.
But first of all, let me actually show you the numbers. Okay, so as you can see, we're right here on stock. MVP You can get it at stock. Dash Mvp.com Try it out! So stock MVP shows us that we have short interest of 2.6 that is not very high low short interest.
Now the PE is 31. It's not cheap, but compared to Nvidia, 31 is sounding really, really cute right now, especially with the numbers you're about to see. So it's not a cheap company, but it's definitely not parabolic. Now you can see that the stock also did quite well over the past 30 months.
It's uh, it's like down five percent. but if you go to a one month mode, you're gonna see it's up five percent one year mode 64 so depend how you spend this if I go back One year this thing was trading at 100. now a year later it's at 150. It had a big spike but nothing that comes close to Nvidia volunteer and the rest of these stocks.
It went absolutely ape wild because of this AI thing. Now look here's the thing. Look at the cars right here. Let me just show you the fundamentals here.
Now we already talked about the fact that have Ai exposure, data center exposure their market leader. They're working with the best clients and they will benefit from AI driven spending on data centers. And look at the revenue: 5 billion Revenue Look at the growth 50 growth in a year. they did 1.8 billion just five years ago.
They're currently at five. Look at the margin here. Operating income is 1.7 billion, net income is 1.5 billion. Look at the numbers up to 100 of five years. the net income was just 500 million. Five years ago. Now they've tripled that in just five years. Now that's the one part.
I Also, like here, the debt is 55 million, the cash is 1 billion. So it's literally. Uh, you know it kind of reminds me of Palantir. Tesla You know High Cash Virtually no debt Operating margins 35 percent.
Look at the this is incredible. Total asset: 7.5 billion total abilities on this company is about 2.2 billion. So three, almost three and a half times access to liabilities. Excuse my math here and you know everything here checks out now.
31pe Again, 31b isn't cheap. But these fundamentals. with the opportunity it has and the similarity it has, it has very, very interesting path. I Think now if you go to a DCF valuation here and we actually run it through the model here, so the company is guiding towards a 30 ebitda growth.
For our model, we're going to Crunch in 25 I Think it might be a little bit. you know it's safe to be a little bit under the guidance. 10 10 for capex and depreciation? That's fine. Uh, discount rate I Think we can use 10 given the fact that interest rates are expected to come down in the next five years.
So 10 would be reasonable. And that's our valuation by the way, that's how fast it takes to do a DCF model in stock. MVP Literally takes a minute. that's why I Love the software! So Currently our DC evaluation is 209.
So as you can see, this company has all the right pieces in place. The fundamentals are off the charts, the margins are great, the guidance is great, the company is growing and it has the right exposure to Data Centers and AI to benefit from this. Spike and it's not competing with Nvidia. In fact, if Nvidia does well which I think well, first company will also do well and have clients is Microsoft Amazon We just talked about it.
Massive clients, 50 billion market cap. Now all we have to do with this company is DCA to it slowly I Don't say rush into it. my system isn't to buy it up and now just pull everything into it slowly. the Holocaust average over a couple of years.
Build your position slowly if you want to learn more about how to slowly build your positions, how to do it without the hype, without the form or without the anxiety. What's the right way to invest so you can actually reap the rewards When it happens, head on over to our Patreon Patreon.com Forward slash: Tom Nash I Have a five dollar subscription which I suggest you try it out. It has a 30-day money-back guarantee if you don't like it for 30 days. I'm just gonna refund you so there's no risk for you.
Try it out, Tell me what you think and of course a huge shout out to or for sponsoring this video. The link is below: Get rid of these data Brokers that are having your information and exploiting it. Take care of this once and for all. Thank me later. Thank you Aura See you next video.
Tom isn't this just "A net"?😅
I cant find the Expense Rationof the stock
So what is the next NVIDIA guys? Save me the time
You said that NVDA is fairly valued at 200 😅
NVIDIA is going to rise to $1100 by next summer. This is a very unique situation like bitcoin. AI is going to have a massive breakthrough if it doesn’t get regulated by our government.
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Thanks Tom for sharing this insight. You didn't answer the critical question, are YOU buying it? Are YOU DCAing it?
hi anyone i like to ask on "brandywine realty trust ; nyse", what is their situation?
do you still like $VALE?
@tomnash – do a video on AMSL?
Thanks Tom
Really like this format 👍
AMD super undervalued as stock buy it while it's still low
Bunge 30 pct short
Larry williams saying pullback comin buddy
For the algo
Interesting
Nine work
Tom what's your thoughts on CRWD. I think it's a good entry level as of now. The financials look pretty good as well. Thx
Interesting, on my watchlist but massive insider selling this past month.
👍
Nvidia is an established company, why A Net when AMD is cheaper?
Lost all respect and creditability after sucking up to chicken
hey Tom, what is the difference with Arista and Cisco?
Nice find! Love these videos