Why Arista Networks (ANET) Outpaced the Stock Market Today
Arista Networks (ANET) closed the latest trading day at $266.60, indicating a +1.17% change from the previous session's end. This move outpaced the S&P 500's daily gain of 0.22%. Elsewhere, the Dow saw an upswing of 0.36%, while the tech-heavy Nasdaq appreciated by 0.32%.
Coming into today, shares of the cloud networking company had gained 10.6% in the past month. In that same time, the Computer and Technology sector gained 3.64%, while the S&P 500 gained 1.61%.
Analysts and investors alike will be keeping a close eye on the performance of Arista Networks in its upcoming earnings disclosure. The company's earnings report is set to go public on February 12, 2024. The company is predicted to post an EPS of $1.70, indicating a 20.57% growth compared to the equivalent quarter last year. Our most recent consensus estimate is calling for quarterly revenue of $1.53 billion, up 19.98% from the year-ago period.
It is also important to note the recent changes to analyst estimates for Arista Networks. These recent revisions tend to reflect the evolving nature of short-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.
Our research demonstrates that these adjustments in estimates directly associate with imminent 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, which varies between #1 (Strong Buy) and #5 (Strong Sell), carries an impressive track record of exceeding expectations, confirmed by external audits, with stocks at #1 delivering an average annual return of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has moved 0.31% higher. Arista Networks is currently a Zacks Rank #1 (Strong Buy).
Investors should also note Arista Networks's current valuation metrics, including its Forward P/E ratio of 36.54. For comparison, its industry has an average Forward P/E of 18.33, which means Arista Networks is trading at a premium to the group.
It is also worth noting that ANET currently has a PEG ratio of 1.85. 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. ANET's industry had an average PEG ratio of 1.9 as of yesterday's close.
The Communication - Components industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 111, putting it in the top 45% of all 250+ industries.
The Zacks Industry Rank is ordered from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
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Arista Networks, Inc. (ANET) : Free Stock Analysis Report
