1 Stock to Buy, 1 Stock to Sell This Week: Arista Networks, CVS Health

Date:

• U.S. presidential election, Fed FOMC meeting, and more earnings will be in focus this week.

• Arista Networks is a buy with a strong beat-and-raise quarter expected.

• CVS Health is a sell with declining profitability and weak guidance on deck.

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Wall Street’s major indexes closed higher on Friday, as Amazon (NASDAQ:AMZN)’s strong earnings sparked a rally in the megacap tech stocks, and the market looked past a disappointing jobs report.

All three benchmarks were down for the week, however, with the S&P 500 falling 1.4%, the tech-heavy Nasdaq Composite dropping 1.1% and the blue-chip Dow Jones Industrial Average shedding 0.2%.

Source: Investing.com

The important week ahead is expected to be a volatile one given the sizable market-moving events taking place.

Firstly, Tuesday is election day, with the presidential race between Kamala Harris and Donald Trump too close to call. Voters also will decide hundreds of congressional and state elections.

The Fed’s November meeting then kicks off the following day. An announcement is due Thursday. With a 25-basis point rate cut seen as nearly certain, investors will scrutinize comments from Fed Chair Jerome Powell amid speculation of a December pause.

Source: Investing.com

Elsewhere, the earnings season continues, with the list of notable tech-related names due to report including Arm Holdings (NASDAQ:ARM), Qualcomm (NASDAQ:QCOM), Palantir (NYSE:PLTR), Arista Networks (NYSE:ANET), Datadog (NASDAQ:DDOG), Fortinet (NASDAQ:FTNT), and Block (NYSE:SQ).

Some of the other high-profile reporters include Novo Nordisk (NYSE:NVO), Moderna (NASDAQ:MRNA), CVS Health (NYSE:CVS), Ferrari (NYSE:RACE), Toyota (NYSE:TM), Rivian (NASDAQ:RIVN), Lucid (NASDAQ:LCID), Airbnb (NASDAQ:ABNB), and DraftKings (NASDAQ:DKNG).

Regardless of which direction the market goes, below I highlight one stock likely to be in demand and another which could see fresh downside. Remember though, my timeframe is just for the week ahead, Monday, November 4 – Friday, November 8.

Arista Networks stands out as a top buy this week, as the networking infrastructure company will likely deliver another quarter of strong sales growth and provide upbeat guidance.

The tech company has benefited immensely from booming demand in data centers as cloud providers and AI-driven companies invest heavily in infrastructure upgrades.

Arista is scheduled to deliver its third-quarter earnings update after the U.S. market close on Thursday at 4:05PM ET.

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