TSP Weekly Tech Stock Update—Oct 19, 2024
This Week: ServiceNow Q3 earnings preview, AAPL/NOW/ANET/CYBR new record highs, PAM is a CIO priority, Rubrik's DSPM for 365 Copilot, William Blair bullish on Elastic, UBS upgrades Datadog & more.
Hello from Rob…
—Arista Networks (ANET, $402) stock on Monday hit a new all-time high of $422.73. After rising 94% in 2023, the shares have advanced 70.7% YTD versus a gain of 23.1% for the Nasdaq Composite. I wrote about Arista’s AI opportunity back in January, when the stock was trading around $252.
Given the outperformance, Arista shares trade at a lofty 48 times the 2024 consensus EPS estimate of $8.28 and 42x the 2025 consensus of $9.47. Analysts on average are calling for 2024 top-line growth of 16.2%, accelerating to 18% growth next year.
Citi earlier this month raised its Arista price target to $460 from $385, saying it expects 2025 datacenter CapEx for the big cloud providers to expand by 40% because of continued AI demand and ongoing investment in datacenter infrastructure.
—Shares of CyberArk Software (CYBR, $299.98) this week hit a new all-time high of $308.63. The stock is up 36.9% YTD.
On Friday, Cleveland Research initiated coverage of CyberArk at ‘Buy’ with a price target of $390, saying its partner feedback suggests privileged access management (PAM) remains a top priority investment for customers.
Wedbush in early October boosted its CyberArk target to $325 from $300. The firm notes the emergence of AI is creating more sophisticated malware, making identity protection a critical focus area for CIOs and CISOs.
BTIG Research lifted its CyberArk target to $325 from $310, calling out positive feedback from recent conversations with PAM industry contacts indicating continued momentum in the market and an increase in large-deal activity.
*Inside This Issue: Microsoft’s FY’25 AI Revenue Potential
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