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Arista Networks (ANET) Dips More Than Broader Markets: What You Should Know

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Arista Networks (ANET - Free Report) closed the most recent trading day at $127.07, moving -1.83% from the previous trading session. This move lagged the S&P 500's daily loss of 1.81%. Elsewhere, the Dow lost 1.47%, while the tech-heavy Nasdaq lost 0.51%.

Heading into today, shares of the cloud networking company had lost 2.71% over the past month, lagging the Computer and Technology sector's loss of 1.94% and the S&P 500's loss of 1.84% in that time.

Arista Networks will be looking to display strength as it nears its next earnings release, which is expected to be February 14, 2022. In that report, analysts expect Arista Networks to post earnings of $0.74 per share. This would mark year-over-year growth of 19.35%. Our most recent consensus estimate is calling for quarterly revenue of $790.58 million, up 21.91% from the year-ago period.

Investors should also note any recent changes to analyst estimates for Arista Networks. Recent revisions tend to reflect the latest near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. 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, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 0.18% higher within the past month. Arista Networks is currently sporting a Zacks Rank of #2 (Buy).

Valuation is also important, so investors should note that Arista Networks has a Forward P/E ratio of 36.69 right now. Its industry sports an average Forward P/E of 18.83, so we one might conclude that Arista Networks is trading at a premium comparatively.

It is also worth noting that ANET currently has a PEG ratio of 2.19. 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. Communication - Components stocks are, on average, holding a PEG ratio of 1.88 based on yesterday's closing prices.

The Communication - Components industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 164, which puts it in the bottom 36% of all 250+ industries.

The Zacks Industry Rank includes is listed in order 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.

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

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