Equity Research Reports

This analysis evaluates Arista Networks' valuation, growth prospects, and risks as of December 2025, focusing on its transition to AI infrastructure leadership and competitive dynamics with peers like Nvidia.

This comprehensive analysis examines the AI ecosystem's complete value chain, from energy infrastructure and chip design tools to semiconductor manufacturers and model builders. With valuations reaching historical extremes in 2024-2025, we assess whether the AI theme remains investable for 2026. The report analyzes ten key players across EDA software, power generation, chip design, cloud infrastructure, and AI development, providing perspective on competitive positioning and growth sustainability. Our analysis suggests a bifurcated outlook: infrastructure winners with pricing power versus challenged hardware suppliers facing margin compression.

GTC's Q3 2025 results showed a 9% overall revenue growth, but a 4% decrease excluding the German acquisition, highlighting the impact of the recent acquisition on the company's financials. The company's EBITDA dropped to EUR 77 million, mainly due to asset disposals and increased property expenses, resulting in a loss of EUR 28 million, compared to a profit of EUR 41 million last year. The actual EPS came out at '-0.21719', relative to estimates at '0.1316', a significant miss. Analysts estimate next year's revenue growth at -5.2%, indicating a challenging environment for the company.

KNOT Offshore Partners (KNOP) reported a robust Q3 2025, with revenues reaching $96.9 million, operating income of $30.6 million, and net income of $15.1 million. The adjusted EBITDA was $61.6 million, indicating a healthy operational performance. Earnings per share (EPS) came in at $0.45, significantly beating estimates of $0.13. The company's financial performance was bolstered by its fleet operations, with an average fleet age of 10 years and a backlog of $963 million in fixed contracts, averaging 2.6 years.

Laurentian Bank reported net income on an adjusted basis of $147.2 million or $3 per share, with diluted EPS of $2.85 on a reported basis. The bank's net interest income increased year-over-year, driven by a more favorable business mix and an improved net interest margin of 1.83%, up from 1.79% in the prior year. The actual EPS came in at $0.73 relative to estimates of $0.74, a minor miss. The bank's efficiency ratio was 75.2%, aligned with guidance, indicating effective cost management.

Victoria's Secret & Co. reported a standout third quarter with net sales of $1.47 billion, a 9% increase from the previous year, and adjusted gross margin expansion of 170 basis points. Earnings growth was 45%, driven by growth across Victoria's Secret, PINK, and Beauty. The actual EPS came out at -$0.27, beating estimates of -$0.6. The company's Intimates business returned to growth, up mid-single digits, gaining over 1% share in the U.S. Intimates market.

Hewlett Packard Enterprise (HPE) closed a transformative fiscal year 2025 with a record fourth quarter, reporting revenue of $9.7 billion, a 14% year-over-year increase. The non-GAAP operating margin hit a record 12.2%, and non-GAAP diluted net earnings per share was $0.62, exceeding guidance. The company's strong financial performance was driven by a 51% increase in networking revenue, largely due to the Juniper Networks acquisition. For the full year, HPE reported $34.3 billion in revenue, up 14% year-over-year, with non-GAAP diluted net earnings per share of $1.94.

Stitch Fix reported revenue of $342.1 million for Q1 2026, exceeding expectations and representing a 7.3% year-over-year increase. Adjusted EBITDA was $13.4 million, approximately 4% of revenue. The company's earnings per share (EPS) was -$0.05, in line with estimates. Gross margin was 43.6%, within the FY 2026 guided range. The company's strong performance was driven by its client-centric and personalized shopping experience, with active clients reaching 2.3 million, at the high end of expectations. Revenue per active client was $559, up 5.3% year-over-year.

Domo, Inc.'s Q3 Fiscal Year 2026 earnings report showcased a significant improvement in the company's financial performance, with positive adjusted free cash flow of $2.1 million, a $15.8 million improvement over last year. The company achieved an operating margin of 6.8%, exceeding guidance, and posted positive EPS for the second consecutive quarter, with non-GAAP diluted net income per share at $0.01, beating estimates of -$0.05. Billings came in at $73.2 million, and total subscription RPO grew 15% to $405.9 million. Gross retention was 85%, and ARR net retention was 95%, up sequentially for the fifth straight quarter.

Smith & Wesson Brands, Inc. reported its second-quarter fiscal 2026 financial results, with net sales of $124.7 million, down 3.9% from the prior year. The company's gross margin was 24.3%, down 2.3% from the prior year due to decreased absorption on temporarily lower production and an 80-basis-point negative impact from tariffs. Earnings per share were 4 cents, compared with 10 cents in the prior year period, missing analyst estimates of 5 cents. Operating expenses were $26.2 million, down $733,000 from the prior year, indicating some control over costs. The company's EBITDA was $15 million, and operating cash flow was $27.3 million, demonstrating its ability to generate cash.

Argan, Inc. reported revenue of $251.2 million for the third quarter of 2026, a 2% decrease from the prior year period, primarily due to the timing of certain projects. However, revenue increased 6% sequentially from the second quarter. Gross margin improved to 18.7% compared to 17.2% in the prior year period. Net income was $31 million or $2.17 per diluted share, beating analyst estimates of $1.82. EBITDA was $40.3 million or 16% of revenue.

Samsara reported revenue of $416 million, growing 29% year-over-year, with non-GAAP gross margin at 78% and non-GAAP operating margin at a quarterly record 19%. The company's earnings per share (EPS) came in at $0.15, beating estimates of $0.1182. Free cash flow margin was 13% in Q3, up 4 percentage points year-over-year. As Sanjit Biswas noted, "the combination of investments in scale, security, and infrastructure, as well as customized products for complex organizations, has been a big unlock for the company."

The Cooper Companies reported a record Q4 2025 revenue of $1.065 billion, representing a 4.6% year-over-year increase, or 3.4% on an organic basis. Non-GAAP earnings per share (EPS) came in at $1.15, beating analyst estimates of $1.11, reflecting an 11% growth. The company's gross margin decreased in Q4, but it expects operating margin leverage due to controlled SG&A growth. CooperVision's revenue was $710 million, up 4.9% or 3.2% organically, driven by the strong performance of its MyDay premium daily silicone hydrogel lens portfolio.

Zumiez, Inc.'s third-quarter fiscal 2025 earnings conference call highlighted the company's strong performance, with net sales reaching $239.1 million, up 7.5% from $222.5 million in the third quarter of 2024. Gross profit was $89.8 million, up 14.7% compared to $78.3 million in the third quarter of last year, driven by a 7.6% comparable sales growth, marking its sixth consecutive quarter of positive comparable sales growth. Earnings per share reached $0.55 in the quarter, well above the high end of guidance of $0.29 and analyst estimates of $0.27, with actual EPS coming in at $0.55 versus estimates, although some reports indicated $0.46. Operating income was $11.8 million or 4.9% of net sales, compared with operating income of $2.4 million or 1.1% of net sales last year.

Sportsman's Warehouse Holdings, Inc. reported its third-quarter 2025 earnings, with same-store sales growing 2.2% year-over-year, marking the third consecutive quarter of positive growth. Net sales were $331.3 million, up 2.2% compared to the prior year. Gross margin improved 100 basis points to 32.8%, driven by healthier inventory, lower freight expense, and improved shrink. Adjusted EBITDA grew 13% to $18.6 million, while adjusted net income was $3 million, or $0.08 per diluted share, slightly missing estimates of $0.09 per diluted share.

Ulta Beauty's third-quarter 2025 results exceeded expectations, with net sales increasing 12.9% to $2.9 billion, operating profit at 10.8% of sales, and diluted EPS of $5.14 per share, beating analyst estimates of $4.61. The company's gross margin increased 70 basis points to 40.4% of sales, primarily due to lower inventory shrink and higher merchandise margin. The strong top-line results were fueled by the investments made to support the Ulta Beauty Unleashed strategy.

SentinelOne reported a robust Q3 FY 2026, with revenue growing 23% year-over-year to $259 million, and net new ARR adding $54 million. The company's ARR grew 23% to a new high, driven by strong demand for its emerging platform solutions, including Purple AI, Cloud Security, and Data Solutions. The operating margin reached a new high, demonstrating continued operating leverage and increasing efficiencies. EPS came in at $0.07, beating estimates of $0.05.

Inotiv reported total revenue of $138.1 million for Q4 2025, representing a 5.9% increase from Q4 2024, driven primarily by a $7.1 million increase in Discovery & Safety Assessment (DSA) segment revenue. For fiscal year 2025, total revenue was $513 million, a 4.5% increase from fiscal year 2024. The company's operating loss decreased to $6.8 million in Q4 2025 from $13.2 million in Q4 2024. Non-GAAP operating income for DSA was $9.3 million in Q4 2025, and $28.5 million for fiscal year 2025. Adjusted EBITDA was $11.8 million in Q4 2025 and $34 million for fiscal year 2025. Actual EPS came out at -$0.14, relative to estimates at -$0.08.

Methode Electronics reported its fiscal 2026 second-quarter financial results, with net sales of $247 million, up 3% sequentially, and adjusted EBITDA of $18 million, a 12% sequential increase. The company's actual EPS came out at -$0.19, missing estimates of -$0.14. The sequential increase in sales and adjusted EBITDA indicates a positive trend, but the miss on EPS is a concern. The company's Power Solutions business, which accounts for a significant portion of Methode's revenue, is expected to be flat for the full year.

Hovnanian Enterprises, Inc. reported its fiscal 2025 fourth-quarter earnings, with revenues of $818 million, adjusted gross margin of 16.3%, and adjusted pretax income of $49 million. The company's EPS came out at $5.96, significantly higher than the estimated $0.63. The adjusted EBITDA was $89 million, and SG&A was 11.2% of revenues. The results met or exceeded the company's guidance, with income from unconsolidated joint ventures contributing $13 million.

EQB's fiscal 2025 financial performance was marked by a mixed bag of results, with diluted EPS coming in at $1.53, below analyst estimates of $2.42. Net interest income (NII) was $265 million, down 2% year-over-year, but up 1% sequentially. Net interest margins expanded 4 basis points sequentially but were down 8 basis points year-over-year. Noninterest revenue was $43.5 million, down 15% from last year and 9% from last quarter. The company's efficiency ratio was flat compared to last quarter.

John Wiley & Sons, Inc. reported a mixed revenue picture for Q2 2026, with adjusted operating margin expanding 250 basis points to 18.8%. Revenue growth was driven by the research segment, which delivered 7% growth, while the learning segment faced challenges, resulting in an 11% decline. Earnings per share (EPS) came in at $1.1, beating estimates of $1.03. The company's strong balance sheet is expected to get even stronger, with a current yield of around 3.9% and a return of $73 million to shareholders in buybacks and dividends.