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Time to Buy These "Unique" Top-Rated Stocks as Earnings Approach
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As we move through February and continue to progress through a crucial earnings season there are two top-rated stocks among the Zacks Computer & Technology sector and the Oils & Energy sector that are starting to stand out.
Here is a look at these two ‘unique’ companies that investors may want to consider buying with their quarterly reports approaching.
Arista Networks, which provides cloud networking solutions for data centers and cloud computing environments, is set to report its fourth-quarter earnings on Monday, February 13.
Arista Networks Communication-Components Industry is currently in the top 32% of over 250 Zacks Industries. The company looks set to benefit from a strong business environment with earnings estimates rising throughout the quarter landing ANET stock a Zacks Rank #2 (BUY).
Image Source: Zacks Investment Research
Q4 Preview: Arista’s Q4 earnings are expected at $1.21 per share, which would be a 47% increase from Q4 2021. Fiscal 2022 earnings are now projected to climb 52% to $4.38 per share compared to EPS of $2.87 in 2021. Plus, fiscal 2023 earnings are forecasted to jump another 19% to $5.23 per share.
On the top line, Q4 sales are forecasted to be $1.20 billion, up 45% from the prior year quarter. Total sales are now anticipated to be up 46% for FY22 and pop another 22% in FY23 to $5.24 billion. More impressive, Fiscal 2023 sales would represent 143% growth over the last five years with 2018 sales at $2.15 billion.
Image Source: Zacks Investment Research
Earnings ESP: The Zacks Expected Surprise Prediction indicates that Arista could miss Q4 bottom-line estimates with the Most Accurate Estimate at $1.18 per share and the Zacks Consensus having EPS at $1.21.
Image Source: Zacks Investment Research
Takeaway: Despite the possibility of missing bottom-line expectations, the rising earnings estimates are a good sign and indicate that Arista Networks could provide better-than-expected guidance which has been crucial this earnings season. Furthermore, Arista’s annual top and bottom line growth is very intriguing as the importance of cloud technology solutions continues to grow as well.
Lastly, Arista stock is now up +131% over the last three years to largely outperform the S&P 500’s +23% and the Nasdaq’s +21%. This largely reflects Arista’s unique and expansive niche among the broader technology sector.
Another company with a unique business niche is Israel-based SolarEdge Technologies which is also set to report its Q4 earnings on February 13.
SolarEdge is part of the Zacks Oils & Energy sector and its Solar Industry is currently in the top 19% of all Zacks Industries. As the importance of alternative energy continues to expand throughout society SolarEdge is benefiting as a leader in its space.
Specifically, SolarEdge is a leading provider of an optimized inverter solution, which consist of inverters and power optimizers incorporating a communications device that enables access to a cloud-based monitoring platform and smart energy management solutions.
Heading into its quarterly report, SolarEdge sports a Zacks Rank #2 (Buy) with earnings estimates starting to rise again for fiscal 2022 and have continued to go up for FY23.
Image Source: Zacks Investment Research
Q4 Preview: SolarEdge’s Q4 EPS is expected at $1.59, up 44% from $1.10 per share in Q4 2021. This would round out fiscal 2022 earnings at $4.79 per share, virtually flat from a year ago but FY23 earnings are projected to soar 82% to $8.73 per share.
Fourth-quarter sales are forecasted to be $875.38 million, up 58% from the prior year quarter. Total sales would be up 57% YoY for FY22 and are projected to jump another 28% in FY23 to $3.98 billion. Plus, with 2018 sales at $937 million, FY23 would be an outstanding 324% increase over the last five years.
Image Source: Zacks Investment Research
Earnings ESP: SolarEdge may post a nice earnings surprise for Q4 with The Zacks Consensus at $1.59 per share and the Most Accurate Consensus at $1.77 a share.
Image Source: Zacks Investment Research
Takeaway: SolarEdge stock still looks attractive at around $300 per share with the company’s bottom line standing out in fiscal year 2023. Although the company trades at 42.1X forward earnings this is well below its decade high of 113.1X and 42% beneath the median of 72.9X with earnings on the rise.
Furthermore, a strong Q4 earnings beat and positive guidance could be a strong catalyst for SolarEdge stock which is now up +101% over the last three years to easily top the benchmark and beat the Solar Market’s +82%.
Bottom Line
These two top-rated Zacks stocks have unique niches among their respective business industries. As innovation continues among the broader Oils & Energy and Computer & Technology sectors both SolarEdge Technologies and Arista Networks look poised to benefit as leaders in their space.
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Time to Buy These "Unique" Top-Rated Stocks as Earnings Approach
As we move through February and continue to progress through a crucial earnings season there are two top-rated stocks among the Zacks Computer & Technology sector and the Oils & Energy sector that are starting to stand out.
Here is a look at these two ‘unique’ companies that investors may want to consider buying with their quarterly reports approaching.
Arista Networks (ANET - Free Report) )
Arista Networks, which provides cloud networking solutions for data centers and cloud computing environments, is set to report its fourth-quarter earnings on Monday, February 13.
Arista Networks Communication-Components Industry is currently in the top 32% of over 250 Zacks Industries. The company looks set to benefit from a strong business environment with earnings estimates rising throughout the quarter landing ANET stock a Zacks Rank #2 (BUY).
Image Source: Zacks Investment Research
Q4 Preview: Arista’s Q4 earnings are expected at $1.21 per share, which would be a 47% increase from Q4 2021. Fiscal 2022 earnings are now projected to climb 52% to $4.38 per share compared to EPS of $2.87 in 2021. Plus, fiscal 2023 earnings are forecasted to jump another 19% to $5.23 per share.
On the top line, Q4 sales are forecasted to be $1.20 billion, up 45% from the prior year quarter. Total sales are now anticipated to be up 46% for FY22 and pop another 22% in FY23 to $5.24 billion. More impressive, Fiscal 2023 sales would represent 143% growth over the last five years with 2018 sales at $2.15 billion.
Image Source: Zacks Investment Research
Earnings ESP: The Zacks Expected Surprise Prediction indicates that Arista could miss Q4 bottom-line estimates with the Most Accurate Estimate at $1.18 per share and the Zacks Consensus having EPS at $1.21.
Image Source: Zacks Investment Research
Takeaway: Despite the possibility of missing bottom-line expectations, the rising earnings estimates are a good sign and indicate that Arista Networks could provide better-than-expected guidance which has been crucial this earnings season. Furthermore, Arista’s annual top and bottom line growth is very intriguing as the importance of cloud technology solutions continues to grow as well.
Lastly, Arista stock is now up +131% over the last three years to largely outperform the S&P 500’s +23% and the Nasdaq’s +21%. This largely reflects Arista’s unique and expansive niche among the broader technology sector.
SolarEdge Technologies (SEDG - Free Report) )
Another company with a unique business niche is Israel-based SolarEdge Technologies which is also set to report its Q4 earnings on February 13.
SolarEdge is part of the Zacks Oils & Energy sector and its Solar Industry is currently in the top 19% of all Zacks Industries. As the importance of alternative energy continues to expand throughout society SolarEdge is benefiting as a leader in its space.
Specifically, SolarEdge is a leading provider of an optimized inverter solution, which consist of inverters and power optimizers incorporating a communications device that enables access to a cloud-based monitoring platform and smart energy management solutions.
Heading into its quarterly report, SolarEdge sports a Zacks Rank #2 (Buy) with earnings estimates starting to rise again for fiscal 2022 and have continued to go up for FY23.
Image Source: Zacks Investment Research
Q4 Preview: SolarEdge’s Q4 EPS is expected at $1.59, up 44% from $1.10 per share in Q4 2021. This would round out fiscal 2022 earnings at $4.79 per share, virtually flat from a year ago but FY23 earnings are projected to soar 82% to $8.73 per share.
Fourth-quarter sales are forecasted to be $875.38 million, up 58% from the prior year quarter. Total sales would be up 57% YoY for FY22 and are projected to jump another 28% in FY23 to $3.98 billion. Plus, with 2018 sales at $937 million, FY23 would be an outstanding 324% increase over the last five years.
Image Source: Zacks Investment Research
Earnings ESP: SolarEdge may post a nice earnings surprise for Q4 with The Zacks Consensus at $1.59 per share and the Most Accurate Consensus at $1.77 a share.
Image Source: Zacks Investment Research
Takeaway: SolarEdge stock still looks attractive at around $300 per share with the company’s bottom line standing out in fiscal year 2023. Although the company trades at 42.1X forward earnings this is well below its decade high of 113.1X and 42% beneath the median of 72.9X with earnings on the rise.
Furthermore, a strong Q4 earnings beat and positive guidance could be a strong catalyst for SolarEdge stock which is now up +101% over the last three years to easily top the benchmark and beat the Solar Market’s +82%.
Bottom Line
These two top-rated Zacks stocks have unique niches among their respective business industries. As innovation continues among the broader Oils & Energy and Computer & Technology sectors both SolarEdge Technologies and Arista Networks look poised to benefit as leaders in their space.