The stock market closed mixed on Tuesday, with NASDAQ barely holding onto gains, as yields continued to rise.
The 10-year Treasury yield stood near 4.33%. Such has gained investors’ attention and has put pressure on stocks.
Overall, S&P 500 decreased 0.3% to 4,388, while NASDAQ was slightly up 0.1% to 13,506.
Tweet of the Day
Data from @SaaSletter shows security spending slowing down.
We need to see more reports from the cloud natives security platforms like $CRWD, $ZS, $S etc. However, based on results from $FTNT, $PANW. Security is seeing some slowdown into H2 2023. pic.twitter.com/csE5gdjgRa
— Francis (@InvestiAnalyst) August 21, 2023
Chart of the Day
Here is the one-year chart of Arista Networks (ANET) as of August 9, 2023, when the stock was at $177.
Arista Networks makes network switches that help computer servers communicate in data centers. ANET provides Gigabit Ethernet to many companies that run high volume servers that require a lot of bandwidth. Gigabit Ethernet switches are the hardware that connects computers and servers in local networks. The faster the Ethernet switch, the faster data is transmitted between the computers and the local networks.
Arista Networks delivered solid earnings results that beat the street and impressed investors. The stock broke out on the news and has held its gains in a weak market — that’s bullish.
ANET delivered 46% profit growth last quarter, and beat estimates off 32%. Revenue grew 39% and beat estimates of 31%. Management stated Enterprise momentum keeps getting stronger by the quarter for (1) classic cloud networking and (2) Artificial Intelligence (AI). During the past few quarters, Cloud Titans prioritized AI spending, but will have to switch spending to their standard computer infrastructure as well. Arista handles both. However, growth could slow in the coming quarters due to (1) not having to order far in advance and (2) a slowdown in spending from one large customer.
ANET is one of our largest positions in the Growth Stock Portfolio and Aggressive Growth Portfolio. This stock is a true market leader at this time.
