Arista Networks (ANET) Rallied on Outstanding Revenue Growth

Madison Investments, an investment advisor, released its “Madison Mid Cap Fund” third-quarter 2025 investor letter. A copy of the letter can be downloaded here. In the third quarter, the fund (Class I) returned 1.9% compared to the 5.3% increase for the Russell Midcap Index. The Russell Mid Cap Index experienced significant growth in the third quarter of 2025. Information Technology led the performance both in the quarter and YTD. In addition, please check the fund’s top five holdings to know its best picks in 2025.

In its third-quarter 2025 investor letter, Madison Mid Cap Fund highlighted stocks such as Arista Networks, Inc. (NYSE:ANET). Arista Networks, Inc. (NYSE:ANET) is a technology company that engages in the development and distribution of data-driven, client-to-cloud networking solutions. The one-month return of Arista Networks Inc (NYSE:ANET) was -22.25%, and its shares gained 17.68% of their value over the last 52 weeks. On November 20, 2025, Arista Networks Inc. (NYSE:ANET) stock closed at $119.59 per share, with a market capitalization of $150.598 billion.

Madison Mid Cap Fund stated the following regarding Arista Networks Inc (NYSE:ANET) in its third quarter 2025 investor letter:

"Technology stocks continued their very strong performance in 3Q, and we participated with Amphenol, Arista Networks Inc (NYSE:ANET), and MKS within our portfolio. Amphenol and Arista continue to surprise investors with outstanding revenue growth as they capitalize on the surge in Al-related data center spending. While data center growth is a meaningful benefit, we are also encouraged by the strength in other areas of these businesses, such as enterprise for Arista and defense and industrial markets for Amphenol."

Arista Networks Inc (NYSE:ANET) is not on our list of 30 Most Popular Stocks Among Hedge Funds. According to our database, 81 hedge fund portfolios held Arista Networks Inc (NYSE:ANET) at the end of the second quarter, up from 75 in the previous quarter. In the third quarter of 2025, Arista Networks Inc (NYSE:ANET) reported revenue of $2.3 billion, up 27.5% year-over-year, exceeding expectations. While we acknowledge the potential of Arista Networks Inc (NYSE:ANET) as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

In another article, we covered Arista Networks Inc (NYSE:ANET) and shared the list of best fundamentally strong stocks to buy. In Q3 2025, Baron Technology Fund re-established a position in Arista Networks Inc (NYSE:ANET). In addition, please check out our hedge fund investor letters Q3 2025 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.