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Arista Networks (ANET) Rises Yet Lags Behind Market: Some Facts Worth Knowing

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In the latest trading session, Arista Networks (ANET - Free Report) closed at $340.34, marking a +0.08% move from the previous day. The stock trailed the S&P 500, which registered a daily gain of 0.25%. At the same time, the Dow added 0.15%, and the tech-heavy Nasdaq gained 0.03%.

The the stock of cloud networking company has risen by 6.48% in the past month, lagging the Computer and Technology sector's gain of 8.7% and overreaching the S&P 500's gain of 3.34%.

Analysts and investors alike will be keeping a close eye on the performance of Arista Networks in its upcoming earnings disclosure. The company is expected to report EPS of $1.93, up 22.15% from the prior-year quarter. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $1.64 billion, up 12.31% from the year-ago period.

Regarding the entire year, the Zacks Consensus Estimates forecast earnings of $7.92 per share and revenue of $6.69 billion, indicating changes of +14.12% and +14.15%, respectively, compared to the previous year.

Any recent changes to analyst estimates for Arista Networks should also be noted by investors. These revisions typically reflect the latest short-term business trends, which can change frequently. Consequently, upward revisions in estimates express analysts' positivity towards the company's business operations and its ability to generate profits.

Our research reveals that these estimate alterations are directly linked with the stock price performance in the near future. 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, stretching from #1 (Strong Buy) to #5 (Strong Sell), has a noteworthy track record of outperforming, validated by third-party audits, with stocks rated #1 producing an average annual return of +25% since the year 1988. Over the last 30 days, the Zacks Consensus EPS estimate has remained unchanged. Arista Networks is holding a Zacks Rank of #1 (Strong Buy) right now.

Digging into valuation, Arista Networks currently has a Forward P/E ratio of 42.96. This represents a premium compared to its industry's average Forward P/E of 20.37.

It's also important to note that ANET currently trades at a PEG ratio of 2.74. 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 Communication - Components industry stood at 0.83 at the close of the market yesterday.

The Communication - Components industry is part of the Computer and Technology sector. At present, this industry carries a Zacks Industry Rank of 96, placing it within the top 39% of over 250 industries.

The Zacks Industry Rank assesses the strength of our separate industry groups by calculating the average Zacks Rank of the individual stocks contained within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Make sure to utilize Zacks.com to follow all of these stock-moving metrics, and more, in the coming trading sessions.


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