Key Takeaways
- Astera Labs fell 4% today after Democrats swept the midterms, despite guiding fourth-quarter revenue 13% above consensus.
- The drop is a political discount on improving earnings.
- Astera’s forward P/E hit a one-year low before the report, even as estimates climbed.
- CoreWeave’s Nov. 10 report and Nvidia’s on Nov. 17 will show whether data-center builders are pulling back.
Astera Labs (ALAB) posted record revenue after Tuesday’s close and guided far above Wall Street. The stock is down 4% anyway.
AI data-center stocks sold off after Democrats won control of Congress overnight, on fears of tighter rules. Neocloud CoreWeave (CRWV) is down 7%, while Nvidia (NVDA) is up [X%].
Quilter investment strategist Kit Rees summed up the worry: “AI has been an enormous engine powering the US economy, so any curbs on its future development could threaten to put the brakes on growth.”
Astera’s numbers just got better
Third-quarter revenue rose 154% from a year earlier to $584.9 million, above the $550.8 million analysts expected.
It guided to $730 million to $750 million of fourth-quarter revenue, a midpoint 13% above the $656 million consensus. Analysts had penciled in only about 5% growth a quarter after that, so the midpoint already tops what they expected for mid-2027.
Earnings estimates were climbing steeply even before the report:
If Astera hits its midpoint, 2026 adjusted EPS comes to about $4.37, above the chart’s $4.03. Those estimates should rise.
The cheapest it’s been in a year
On Monday, before the report, Astera traded at 41x forward earnings, its lowest point of the past year and far below its 72x average:
At today’s price, it’s about 38x.
TIKR tracks 25 analysts on Astera Labs. How many say “Buy”?
See the full breakdown of Buy, Hold, and Sell ratings on Astera Labs, along with Wall Street’s revenue and earnings estimates, all in one place. More than 500,000 investors use TIKR to research stocks like this one. See Astera Labs’ Analyst Ratings
CoreWeave would feel it first
CoreWeave had 1.5 gigawatts of active power and about 3.7 gigawatts contracted at the end of June. Astera’s new Orion rack design is aimed mainly at neocloud and enterprise customers. CoreWeave’s Nov. 10 report will show whether builders are spending less.
Investors are holding Nvidia at 17x forward earnings while selling Astera at more than twice that. Astera is developing NVLink Fusion parts with Nvidia, so a strong data-center outlook from Nvidia on Nov. 17 would help Astera, too.
A discount for a law nobody has written
Reuters reported that analysts doubt any legislation could meaningfully stall data-center construction.
The way I see it, Astera’s estimates should rise while its multiple shrinks. At about 38x, that looks like an opportunity.
Of course, Astera’s top three end customers made up about 86% of its 2025 revenue. If Washington slows even one of them, Astera will feel it fast.
So what is Astera Labs stock actually worth?
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any of the stocks mentioned. Thank you for reading, and happy investing!
