Buying More of Our Newest Holding After Nvidia Announcement
We continue to see a rising tide of AI spending benefiting this company and its key partners.
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| Symbol | Transaction Type | # Shares Traded | Recent Price $ | Shares Owned After Trade | % Portfolio |
|---|---|---|---|---|---|
ANET | Buy | 230 | $142 | 585 | 1.5% |
After you receive this alert, we will buy 230 shares of Arista Networks (ANET) at or near $142. Following the trade, the Portfolio will own 585 ANET shares, roughly 1.5% of the Portfolio.
Shares of our newest position, Arista Networks, are moving lower on Tuesday following Nvidia's (NVDA) announcement of networking wins with Oracle (ORCL) and Meta (META) for AI data centers. Also weighing on our ANET shares is the latest round of headlines renewing concern among some about an AI bubble. That renewed concern is also hitting our shares of Nvidia and Marvell (MRVL) .
Dealing with the Nvidia win, while it is with one of Arista’s key clients, we’ve seen similar customer win concerns before, most notably with our shares of Marvell. However, given the rising demand for AI and data center capacity, and other factors that are driving network traffic, we see this more as a rising tide lifting multiple boats. That includes Arista as well as Nvidia’s networking business. Let’s also remember that AMD (AMD) , ARM (ARM) and Broadcom (AVGO) are Arista AI partners, and all three have been racking up big wins with OpenAI, which is also a named Arista AI partner.
When we started our initial ANET position, we did so on the smaller side, noting the market’s run and overall mood as well as the 1.48 beta figure attached to ANET shares. That beta figure told us that we could see wide swings in ANET shares, and that is what we are likely seeing on Tuesday.
While we may not be in the earliest innings for AI adoption, as the signals we collect indicate, we are not in the late innings yet, either. Based on announcements over the last several weeks from the likes of CoreWeave (CRWV) and other signals, capital spending levels are ramping and will continue to do so next year. While Big Tech companies may not give any formal capex guidance for 2026 when they report in the next few weeks, the indicated direction of that spending should be favorable to our holdings in the Portfolio.
Following Tuesday's move to add additional ANET shares, the position size remains on the smaller side as we move deeper into the September quarter earnings season. Based on the muted reaction we are seeing to quarterly results from JPMorgan (JPM) and Goldman Sachs (GS) , we are once again back in territory that means companies will need to deliver clean quarterly results and surprise to the upside with their guidance.
That and the continued buildup to President Trump meeting President Xi in South Korea is likely to keep the market volatile. As such, we will continue to pick our spots when it comes to adding additional shares of ANET and others in the Portfolio.
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(Please note that we are looking to execute these trades at or near the share price mentioned above. Once the trade is completed, subscribers can see the trade's executed price here. Be sure to toggle the chart to sort by Purchase Date.)
At the time of publication, TheStreet Pro Portfolio was long ANET, NVDA, META and MRVL.
