ANET Stock – A Pure Play on Data Center Growth
AI has been around for a long time, but you couldn’t tell that by looking at all the freshly minted AI experts cropping up left and right. With over 400 generative AI startups being funded, it’s safe to say some of the biggest future success stories in AI aren’t even broadly known yet. For investors, an intuitive way to approach the growth of AI is to invest in the hardware used to build out data centers – the AI factories that NVIDIA’s CEO thinks every large company will soon be building. Arista Networks (ANET) is one pure-play way to get exposure to the growth of data centers.
About Arista Networks
Our recent video on Arista noted their strong stock performance – +2,100% since their IPO a decade ago compared to a Nasdaq return of +287% over the same time frame. That outperformance can be attributed to the strong growth Arista has seen selling ethernet hardware, much of which was at the expense of Cisco (CSCO) which lost their majority market share in the broader ethernet switch market. Arista’s largest clients – Meta and Microsoft – point to increasing expenditures on data center hardware. If you’re purchasing a lot of GPUs, you need a place to put them and a way to connect them.
