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Arista Networks (ANET) Outpaces Stock Market Gains: What You Should Know

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In the latest trading session, Arista Networks (ANET - Free Report) closed at $196.47, marking a +0.48% move from the previous day. This change outpaced the S&P 500's 0.14% gain on the day. Meanwhile, the Dow gained 0.22%, and the Nasdaq, a tech-heavy index, added 0.09%.

Coming into today, shares of the cloud networking company had gained 10.91% in the past month. In that same time, the Computer and Technology sector gained 0.07%, while the S&P 500 lost 1.27%.

Investors will be hoping for strength from Arista Networks as it approaches its next earnings release. In that report, analysts expect Arista Networks to post earnings of $1.58 per share. This would mark year-over-year growth of 26.4%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $1.48 billion, up 25.68% from the year-ago period.

ANET's full-year Zacks Consensus Estimates are calling for earnings of $6.16 per share and revenue of $5.75 billion. These results would represent year-over-year changes of +34.5% and +31.29%, respectively.

Investors might also notice recent changes to analyst estimates for Arista Networks. Recent revisions tend to reflect the latest near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 0.46% higher. Arista Networks is currently a Zacks Rank #2 (Buy).

Investors should also note Arista Networks's current valuation metrics, including its Forward P/E ratio of 31.72. This represents a premium compared to its industry's average Forward P/E of 22.79.

Also, we should mention that ANET has a PEG ratio of 1.69. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The Communication - Components industry currently had an average PEG ratio of 1.69 as of yesterday's close.

The Communication - Components 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 27% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our 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.

You can find more information on all of these metrics, and much more, on Zacks.com.


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