Key Highlights
- Evercore ISI has elevated Arista Networks (ANET) stock and IBM (IBM) stock to its tactical outperform roster prior to their first-quarter earnings announcements
- IBM (IBM) stock earnings scheduled for April 22; analyst projects revenue exceeding $15.6B consensus and EPS surpassing $1.81
- Arista Networks (ANET) stock reports May 5; firm anticipates revenue above $2.61B and EPS beyond $0.81 consensus
- Arista Networks is securing major contracts with Anthropic and Google, following its March XPO product debut
- Combined capital expenditure among the five largest hyperscalers is projected to reach nearly $700 billion by 2026, representing 65% annual growth
Evercore ISI’s Amit Daryanani has positioned both Arista Networks (ANET) stock and IBM (IBM) stock on the firm’s tactical outperform roster. The strategic moves precede the companies’ upcoming first-quarter financial disclosures.
Daryanani characterized both situations as classic beat-and-raise scenarios, indicating his forecast that each will surpass Wall Street projections while simultaneously elevating their forward-looking guidance.
IBM will unveil its quarterly performance on April 22. The investment firm anticipates International Business Machines will exceed the Street’s revenue projection of $15.6 billion alongside earnings per share estimates of $1.81.
International Business Machines Corporation, IBM
Daryanani highlighted that prevailing consensus revenue figures suggest a 21% sequential contraction from the previous quarter. This would represent a more pronounced decline compared to the mid-teens percentage drops IBM has typically experienced during first quarters historically.
The technology giant recently finalized its Confluent acquisition ahead of the anticipated timeline. According to Evercore, this transaction should provide a modest boost to software segment revenue expansion.
The research firm projects IBM will elevate its 2026 constant-currency revenue projections accordingly. Evercore’s internal models forecast constant-currency expansion exceeding 5% for the complete fiscal year, with the software division growing above 10%.
Arista Networks (ANET) Stock: Artificial Intelligence Momentum and Customer Expansion
Arista Networks is scheduled to announce results on May 5. Evercore’s analysis suggests the networking specialist will surpass consensus revenue forecasts of $2.61 billion and earnings per share expectations of $0.81.
The investment firm attributed the anticipated superior performance to intensifying artificial intelligence infrastructure demand and sustained strength across enterprise customer segments.
Evercore additionally projects Arista Networks will provide second-quarter revenue guidance exceeding the current Street consensus of $2.78 billion. At minimum, the firm believes Arista will increase its full-year revenue target from approximately $11.25 billion.
Arista Networks has been capturing significant new contracts at Anthropic and Google, broadening its presence beyond its established customer portfolio. Evercore identified these as additive opportunities that should bolster future revenue trajectories.
During March, Arista Networks introduced its XPO product line. Evercore characterized this launch as a potential catalyst for expansion as networking infrastructure transitions from 800G to 1.6 terabit transmission speeds.
Hyperscaler Investment Environment
Evercore’s Daryanani observed that aggregate capital expenditure among the five dominant hyperscaler cloud platforms is tracking toward $700 billion in 2026.
This investment level signifies approximately 65% expansion on a year-over-year basis. The magnitude of this infrastructure spending creates a favorable environment underpinning Arista Networks’ growth trajectory.
Evercore ISI maintains an Outperform rating on Arista Networks (ANET) stock with a $200 per share price objective.
Arista Networks (ANET) stock will report its March quarter financial results on May 5, while IBM (IBM) stock is scheduled to announce earnings on April 22.
