In the latest close session, Arista Networks (ANET) was up +2.67% at $146.66. This move outpaced the S&P 500's daily gain of 0.48%. Elsewhere, the Dow gained 0.27%, while the tech-heavy Nasdaq added 0.94%.
Heading into today, shares of the cloud networking company had gained 8.65% over the past month, outpacing the Computer and Technology sector's gain of 5.46% and the S&P 500's gain of 2.46%.
Analysts and investors alike will be keeping a close eye on the performance of Arista Networks in its upcoming earnings disclosure. The company is predicted to post an EPS of $0.72, indicating a 20% growth compared to the equivalent quarter last year. Meanwhile, our latest consensus estimate is calling for revenue of $2.26 billion, up 24.73% from the prior-year quarter.
For the entire fiscal year, the Zacks Consensus Estimates are projecting earnings of $2.81 per share and a revenue of $8.78 billion, representing changes of +23.79% and +25.39%, respectively, from the prior year.
Additionally, investors should keep an eye on any recent revisions to analyst forecasts for Arista Networks. Recent revisions tend to reflect the latest near-term business trends. As such, positive estimate revisions reflect analyst optimism about the business and profitability.
Our research suggests that these changes in estimates have a direct relationship with upcoming stock price performance. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.
The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has witnessed an unchanged state. Arista Networks currently has a Zacks Rank of #2 (Buy).
Looking at its valuation, Arista Networks is holding a Forward P/E ratio of 50.77. This expresses a premium compared to the average Forward P/E of 31.99 of its industry.
Also, we should mention that ANET has a PEG ratio of 2.71. The PEG ratio is akin to the commonly utilized P/E ratio, but this measure also incorporates the company's anticipated earnings growth rate. The average PEG ratio for the Internet - Software industry stood at 2.27 at the close of the market yesterday.
The Internet - Software industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 68, which puts it in the top 28% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Don't forget to use Zacks.com to keep track of all these stock-moving metrics, and others, in the upcoming trading sessions.
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Arista Networks, Inc. (ANET): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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