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Arista Networks (ANET) Enhances Cloud-Grade Routing Solutions

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Arista Networks, Inc. (ANET - Free Report) recently augmented its cloud-grade routing solutions to next-generation network edge to better equip its portfolio according to the evolving market conditions. The new capabilities for virtual private networking and traffic engineering will enable multi cloud, metro and 5G RAN-based applications and will likely disrupt the service provider network ecosystem.

The portfolio enhancements will facilitate the migration from legacy routers to software-driven architectures for faster time to revenue and lower operating expenses. The simplification of multi-cloud edge, metro edge and 5G edge designs for cloud and service provider customers will likely help to address the increasing network demand.

Arista’s EOS (Extensible Operating System) offers all the attributes for this next level of cloud-grade routing solutions. The multi-cloud edge delivers services closer to the end customer with 100G/400G directly connecting to the cloud for uninterrupted service that scales globally. Metro edge designs are equipped with high density merchant silicon-based 100G/400G routing platforms that offer faster and scalable service delivery to meet the surging bandwidth demand. A 5G edge architecture will help to meet the burgeoning data demand from distributed nodes and radically scaled user/device and traffic profiles.

Arista continues benefiting from the expanding cloud networking market, driven by strong demand for scalable infrastructure. In addition to high capacity and easy availability, its cloud networking solutions promise predictable performance along with programmability that enables integration with third-party applications for network management, automation and orchestration. The company’s product portfolio facilitates the implementation of high performance, highly scalable and appropriate solutions for every environment. It offers one of the broadest product lines of datacenter and campus 1/2.5/5/10/25/40/50/100/400 Gigabit Ethernet switches and routers in the industry. Arista provides routing and switching platforms with industry-leading capacity, low latency, port density and power efficiency. The company also continues to innovate in areas such as deep packet buffers, embedded optics and reversible cooling.

Arista’s strategy of leveraging merchant silicon from multiple suppliers has expanded its product portfolio and increased its ability to offer products at lower prices. This has also helped it to focus on developing software like EOS and CloudVision. While EOS is core to the company’s cloud networking solutions for next-generation data centers and cloud networks, CloudVision is a network-wide approach for workload orchestration, workflow automation and real-time telemetry as a turnkey solution for cloud networking. Arista is well positioned to benefit from strong demand for its data center switches. Continued spending on IT infrastructure products (server, enterprise storage and Ethernet switches) for deployment in cloud environments is likely to benefit the company. Its switches and routers support the high-end cloud networking market that requires fast throughput at low cost.    

The stock has gained 71.5% over the past year compared with the industry’s rise of 34%.

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We remain impressed with the inherent growth potential of this Zacks Rank #3 (Hold) stock.  Some better-ranked stocks in the broader industry are Knowles Corporation (KN - Free Report) , Juniper Networks, Inc. (JNPR - Free Report) and Qualcomm Incorporated (QCOM - Free Report) , each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Knowles has a long-term earnings growth expectation of 10%. It delivered an earnings surprise of 10.8%, on average, in the trailing four quarters.

Juniper has a long-term earnings growth expectation of 11.8%. It delivered an earnings surprise of 7.5%, on average, in the trailing four quarters.

Qualcomm has a long-term earnings growth expectation of 21%. It delivered an earnings surprise of 13.5%, on average, in the trailing four quarters.

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