Arista Networks (ANET) ended the recent trading session at $93.70, demonstrating a -3.2% swing from the preceding day's closing price. This change lagged the S&P 500's daily gain of 0.55%. At the same time, the Dow added 0.25%, and the tech-heavy Nasdaq gained 0.63%.
Heading into today, shares of the cloud networking company had gained 4.85% over the past month, lagging the Computer and Technology sector's gain of 11.3% and the S&P 500's gain of 6.29% in that time.
Investors will be eagerly watching for the performance of Arista Networks in its upcoming earnings disclosure. The company's upcoming EPS is projected at $0.65, signifying a 25% increase compared to the same quarter of the previous year. Meanwhile, our latest consensus estimate is calling for revenue of $2.11 billion, up 24.67% from the prior-year quarter.
In terms of the entire fiscal year, the Zacks Consensus Estimates predict earnings of $2.56 per share and a revenue of $8.31 billion, indicating changes of +12.78% and +18.72%, respectively, from the former year.
Investors might also notice recent changes to analyst estimates for Arista Networks. These latest adjustments often mirror the shifting dynamics of short-term business patterns. Hence, positive alterations in estimates signify analyst optimism regarding the company's business and profitability.
Our research suggests that these changes in estimates have a direct relationship with upcoming stock price performance. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
The Zacks Rank system, ranging from #1 (Strong Buy) to #5 (Strong Sell), possesses a remarkable history of outdoing, externally audited, with #1 stocks returning an average annual gain of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has remained steady. As of now, Arista Networks holds a Zacks Rank of #2 (Buy).
Looking at its valuation, Arista Networks is holding a Forward P/E ratio of 37.83. This denotes a premium relative to the industry's average Forward P/E of 29.13.
One should further note that ANET currently holds a PEG ratio of 2.56. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. By the end of yesterday's trading, the Internet - Software industry had an average PEG ratio of 2.33.
The Internet - Software industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 54, putting it in the top 22% of all 250+ industries.
The Zacks Industry Rank evaluates the power of our distinct industry groups by determining the average Zacks Rank of the individual stocks forming the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
To follow ANET in the coming trading sessions, be sure to utilize Zacks.com.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Arista Networks, Inc. (ANET): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
Zacks Investment Research
