Cramer's Lightning Round: Costco Preferred Over Sprouts Farmers Market
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Sep 30 2025
0mins
Should l Buy ANET?
Source: CNBC
Arista Networks Performance: Arista Networks is performing exceptionally well, receiving positive remarks for its strong performance.
Applied Digital Concerns: While Applied Digital is seen as intriguing, it is noted for its significant financial losses.
Resideo Technologies Outlook: Resideo Technologies is viewed as an interesting concept, but it is considered to have peaked after a substantial rise.
Sprouts Farmers Market Issues: Sprouts Farmers Market is experiencing a decline in stock value, leading to confusion about its performance, with a recommendation to consider Costco instead.
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Analyst Views on ANET
Wall Street analysts forecast ANET stock price to rise
10 Analyst Rating
9 Buy
1 Hold
0 Sell
Strong Buy
Current: 135.120
Low
159.00
Averages
172.88
High
200.00
Current: 135.120
Low
159.00
Averages
172.88
High
200.00
About ANET
Arista Networks, Inc. is a provider of data-driven, client-to-cloud networking for large artificial intelligence (AI), data center, campus and routing environments. Its platforms deliver availability, agility, automation, analytics, and security through an advanced network operating stack. Its platform is its Extensible Operating System (EOS), a modernized publish-subscribe state-sharing networking operating system. Its portfolio of products, services and technologies is grouped into various categories: Core (Data Center, Cloud and AI Networking), Cognitive Adjacencies (Campus and Routing), and Cognitive Network (Software and Services). It offers product portfolios of data-driven, high-speed, cloud and data center Ethernet switches. Its Cognitive Adjacencies include Cognitive Campus Switching, Cloud-Grade Routing and WAN Routing. Its software and services are based on subscription-based models and include various offerings: CloudVision, Arista A-Care Services, CloudEOS and others.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
U.S. Stocks Close Higher as Software Stocks Recover
- Market Recovery: The S&P 500 index rose by 0.05%, the Dow Jones Industrial Average by 0.10%, and the Nasdaq 100 by 0.18% on Friday, indicating a recovery after early losses, reflecting cautious optimism among investors regarding future economic prospects.
- Inflation Data Impact: The U.S. January Consumer Price Index rose by 2.4% year-over-year, below the expected 2.5%, marking the smallest increase in seven months, which may prompt the Fed to continue cutting rates, thus providing support for the stock market and alleviating concerns over rate hikes.
- Strong Software Stock Performance: Software stocks like Crowdstrike Holdings and ServiceNow rose over 4% and 3%, respectively, lifting the broader market and indicating a rebound in investor confidence in tech stocks, particularly amid rapid advancements in AI technology.
- Metal Stocks Retreat: Reports of the Trump administration's plans to narrow tariffs on steel and aluminum products led to declines in metal companies, with Century Aluminum falling over 7%, reflecting the negative impact of policy changes on the sector.
See More
Nvidia Shares Drop as AMD Gains Amid Arista's Shift
- Market Share Shift: Arista Networks CEO Ullal indicated that Nvidia's market share has dropped from 99% to 20%-25% over the past year, suggesting a significant increase in AMD's acceptance as a preferred accelerator, which could threaten Nvidia's dominance.
- Stock Movements: Nvidia's shares fell nearly 3% while AMD's rose close to 1%, reflecting differing investor expectations regarding the future prospects of both companies, particularly amid intensifying competition in the AI processor market.
- Reduced Technology Dependency: Nvidia is gradually decreasing its reliance on Arista's technology as it has developed its own networking solutions to connect AI chips, which may lead to a decline in demand for Arista's offerings and negatively impact its stock performance.
- Industry Dynamics: Despite Nvidia holding approximately 90% of the AI chip market, increasing competition from AMD and Google could affect Nvidia's long-term growth potential, especially in the rapidly evolving AI infrastructure landscape.
See More
Arista Networks Stock Rises on Strong Q4 Earnings and Positive Inflation Data
- Stock Surge: Arista Networks' stock rose 5.4% on Friday, peaking at 10.1% earlier in the session, reflecting strong market confidence in the company's performance and boosting investor sentiment.
- Earnings Beat: The company reported Q4 results with adjusted earnings per share of $0.82 and revenue of $2.49 billion, surpassing Wall Street's expectations of $0.76 and $2.39 billion, indicating ongoing benefits from AI infrastructure investments.
- Positive Guidance: Arista targets approximately $2.6 billion in revenue for the current quarter, exceeding Wall Street's prior forecast of $2.46 billion, while management anticipates an adjusted gross margin between 62% and 63% and an operating margin around 46%, showcasing robust profitability.
- Favorable Inflation Data: The January consumer price index (CPI) came in at 2.4%, below the 2.5% forecasted by economists, reducing the likelihood of Federal Reserve rate hikes, which is expected to positively impact the stock market and growth stocks.
See More
Arista Networks CEO Reports Increased AMD Deployments
- Market Share Shift: Arista Networks CEO Ullal indicated that Nvidia's share in their deployments has dropped from 99% to 20%-25% over the past year, highlighting AMD's rise as a preferred accelerator, which could impact Nvidia's market dominance.
- Stock Price Movements: Following this news, Nvidia's stock fell nearly 3% while AMD's rose close to 1%, reflecting investor sensitivity to market dynamics despite the modest fluctuations.
- Technological Dependency: Nvidia's development of its own networking technology has reduced its reliance on Arista, leading to a 10% drop in Arista's stock over two days, indicating challenges in its role within AI infrastructure.
- Future Outlook: Although Arista's stock rebounded 19% over the past year, the fact that it lost more than half its value in 2023 suggests the company needs to reassess its partnership with Nvidia to adapt to market changes.
See More
Tech Stocks Rise on Friday Afternoon
- Market Recovery: Tech stocks broadly rose on Friday afternoon, reflecting a gradual restoration of investor confidence in the technology sector, which could drive stock prices of related companies higher.
- Strong ETF Performance: The State Street Technology Select Sector SPDR ETF (XPREMIUM) showed robust performance during trading, indicating positive sentiment towards the tech sector that may attract more capital inflows.
- Improved Investor Sentiment: With the rise in tech stocks, investor sentiment has improved, potentially leading more investors to reassess their portfolios and increase allocations to technology stocks.
- Optimistic Industry Outlook: The recovery in the tech sector may signal future economic recovery, especially against the backdrop of accelerated digital transformation, where demand for technology investments from businesses is expected to continue growing.
See More
Wall Street Rebounds as Inflation Data Surprises
- Inflation Data Decline: The annual inflation rate fell from 2.7% to 2.4% in January, undershooting the expected 2.5%, marking the lowest level since May 2025, indicating a potential economic slowdown that may prompt the Fed to consider interest rate cuts, thus impacting market liquidity.
- Core Inflation Eases: Core inflation, excluding food and energy, decreased from 2.7% to 2.5%, the lowest since March 2021, which could influence investor expectations regarding future interest rate policies and subsequently affect stock market performance.
- Small Caps Lead Gains: The Russell 2000 index rose nearly 1.8%, outperforming large-cap stocks, reflecting increased investor confidence in small businesses and potentially indicating optimism about economic recovery.
- Rivian Stock Surge: Rivian Automotive Inc. shares jumped 27%, marking the strongest day in the company's history, after reporting a narrower-than-expected quarterly loss, which may attract more investor interest in the electric vehicle market.
See More
U.S. Stocks Close Higher as Software Stocks Recover
- Market Recovery: The S&P 500 index rose by 0.05%, the Dow Jones Industrial Average by 0.10%, and the Nasdaq 100 by 0.18% on Friday, indicating a recovery after early losses, reflecting cautious optimism among investors regarding future economic prospects.
- Inflation Data Impact: The U.S. January Consumer Price Index rose by 2.4% year-over-year, below the expected 2.5%, marking the smallest increase in seven months, which may prompt the Fed to continue cutting rates, thus providing support for the stock market and alleviating concerns over rate hikes.
- Strong Software Stock Performance: Software stocks like Crowdstrike Holdings and ServiceNow rose over 4% and 3%, respectively, lifting the broader market and indicating a rebound in investor confidence in tech stocks, particularly amid rapid advancements in AI technology.
- Metal Stocks Retreat: Reports of the Trump administration's plans to narrow tariffs on steel and aluminum products led to declines in metal companies, with Century Aluminum falling over 7%, reflecting the negative impact of policy changes on the sector.
See More
Nvidia Shares Drop as AMD Gains Amid Arista's Shift
- Market Share Shift: Arista Networks CEO Ullal indicated that Nvidia's market share has dropped from 99% to 20%-25% over the past year, suggesting a significant increase in AMD's acceptance as a preferred accelerator, which could threaten Nvidia's dominance.
- Stock Movements: Nvidia's shares fell nearly 3% while AMD's rose close to 1%, reflecting differing investor expectations regarding the future prospects of both companies, particularly amid intensifying competition in the AI processor market.
- Reduced Technology Dependency: Nvidia is gradually decreasing its reliance on Arista's technology as it has developed its own networking solutions to connect AI chips, which may lead to a decline in demand for Arista's offerings and negatively impact its stock performance.
- Industry Dynamics: Despite Nvidia holding approximately 90% of the AI chip market, increasing competition from AMD and Google could affect Nvidia's long-term growth potential, especially in the rapidly evolving AI infrastructure landscape.
See More
Arista Networks Stock Rises on Strong Q4 Earnings and Positive Inflation Data
- Stock Surge: Arista Networks' stock rose 5.4% on Friday, peaking at 10.1% earlier in the session, reflecting strong market confidence in the company's performance and boosting investor sentiment.
- Earnings Beat: The company reported Q4 results with adjusted earnings per share of $0.82 and revenue of $2.49 billion, surpassing Wall Street's expectations of $0.76 and $2.39 billion, indicating ongoing benefits from AI infrastructure investments.
- Positive Guidance: Arista targets approximately $2.6 billion in revenue for the current quarter, exceeding Wall Street's prior forecast of $2.46 billion, while management anticipates an adjusted gross margin between 62% and 63% and an operating margin around 46%, showcasing robust profitability.
- Favorable Inflation Data: The January consumer price index (CPI) came in at 2.4%, below the 2.5% forecasted by economists, reducing the likelihood of Federal Reserve rate hikes, which is expected to positively impact the stock market and growth stocks.
See More
Arista Networks CEO Reports Increased AMD Deployments
- Market Share Shift: Arista Networks CEO Ullal indicated that Nvidia's share in their deployments has dropped from 99% to 20%-25% over the past year, highlighting AMD's rise as a preferred accelerator, which could impact Nvidia's market dominance.
- Stock Price Movements: Following this news, Nvidia's stock fell nearly 3% while AMD's rose close to 1%, reflecting investor sensitivity to market dynamics despite the modest fluctuations.
- Technological Dependency: Nvidia's development of its own networking technology has reduced its reliance on Arista, leading to a 10% drop in Arista's stock over two days, indicating challenges in its role within AI infrastructure.
- Future Outlook: Although Arista's stock rebounded 19% over the past year, the fact that it lost more than half its value in 2023 suggests the company needs to reassess its partnership with Nvidia to adapt to market changes.
See More
Tech Stocks Rise on Friday Afternoon
- Market Recovery: Tech stocks broadly rose on Friday afternoon, reflecting a gradual restoration of investor confidence in the technology sector, which could drive stock prices of related companies higher.
- Strong ETF Performance: The State Street Technology Select Sector SPDR ETF (XPREMIUM) showed robust performance during trading, indicating positive sentiment towards the tech sector that may attract more capital inflows.
- Improved Investor Sentiment: With the rise in tech stocks, investor sentiment has improved, potentially leading more investors to reassess their portfolios and increase allocations to technology stocks.
- Optimistic Industry Outlook: The recovery in the tech sector may signal future economic recovery, especially against the backdrop of accelerated digital transformation, where demand for technology investments from businesses is expected to continue growing.
See More
Wall Street Rebounds as Inflation Data Surprises
- Inflation Data Decline: The annual inflation rate fell from 2.7% to 2.4% in January, undershooting the expected 2.5%, marking the lowest level since May 2025, indicating a potential economic slowdown that may prompt the Fed to consider interest rate cuts, thus impacting market liquidity.
- Core Inflation Eases: Core inflation, excluding food and energy, decreased from 2.7% to 2.5%, the lowest since March 2021, which could influence investor expectations regarding future interest rate policies and subsequently affect stock market performance.
- Small Caps Lead Gains: The Russell 2000 index rose nearly 1.8%, outperforming large-cap stocks, reflecting increased investor confidence in small businesses and potentially indicating optimism about economic recovery.
- Rivian Stock Surge: Rivian Automotive Inc. shares jumped 27%, marking the strongest day in the company's history, after reporting a narrower-than-expected quarterly loss, which may attract more investor interest in the electric vehicle market.
See More
