We use cookies to understand how you use our site and to improve your experience.
This includes personalizing content and advertising.
By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties.
You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies.
In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Arista Networks Stock Before Q3 Earnings: To Buy or Not to Buy?
Read MoreHide Full Article
Arista Networks, Inc. (ANET - Free Report) is scheduled to report third-quarter 2024 earnings on Nov. 7, 2024. The Zacks Consensus Estimate for revenues and earnings is pegged at $1.76 billion and $2.09 per share, respectively. Earnings estimates for Arista have improved from $8.24 per share to $8.28 for 2024 and from $9.24 per share to $9.36 for 2025 over the past 60 days.
Find the latest EPS estimates and surprises on Zacks Earnings Calendar.
ANET Estimate Trend
Image Source: Zacks Investment Research
Earnings Surprise History
The communications components provider delivered a four-quarter earnings surprise of 15%, on average, beating estimates on each occasion. In the last reported quarter, the company pulled off an earnings surprise of 8.3%.
Image Source: Zacks Investment Research
Earnings Whispers
Our proven model predicts an earnings beat for Arista for the third quarter. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. This is perfectly the case here. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Arista holds a leadership position in 100-gigabit Ethernet switching share in port for the high-speed datacenter segment. It is increasingly gaining market traction in 200- and 400-gig high-performance switching products.
The company is witnessing solid demand trends among enterprise customers backed by its multi-domain modern software approach, which is built upon its unique and differentiating foundation, the single EOS (Extensible Operating System) and CloudVision stack. The versatility of Arista’s unified software stack across various use cases, including WAN routing and campus and data center infrastructure, sets it apart from other competitors in the industry.
During the quarter, the company added significant new capabilities to its CloudVision platform to simplify network operations with automation, observability and zero trust security capabilities across all enterprise networking domains, from campus to data center, WAN and cloud. These included holistic, 360-degree observability by integrating application and third-party data into Arista’s unified Network Data Lake architecture. This, in turn, delivers superior application performance compared to more complex multi-tier networks while offering advanced monitoring capabilities, enabling a modern network operating model for customers.
The company also secured a $340 million deal from the Alabama Fiber Network, a consortium of eight electric cooperatives, to provide routing and switching equipment for the robust middle-mile network project throughout underserved rural areas across the region. The investment involves the deployment of Arista's high-performance 7280SR3 platform for seamless connectivity across diverse locations. These are likely to have generated incremental revenues in the quarter.
Price Performance
Over the past year, Arista has gained 85.2% compared with the industry’s growth of 78%, outperforming peers like Juniper Networks, Inc. (JNPR - Free Report) and Cisco Systems, Inc. (CSCO - Free Report) .
Image Source: Zacks Investment Research
Key Valuation Metric
From a valuation standpoint, Arista appears to be trading relatively expensive compared to the industry and above its mean. Going by the price/earnings ratio, the company shares currently trade at 42.88 forward earnings, higher than 34.66 for the industry and the stock’s mean of 32.85.
Image Source: Zacks Investment Research
Investment Considerations
Arista continues to benefit from strong momentum and diversification across its top verticals and product lines. The company has a software-driven, data-centric approach to help customers build their cloud architecture and enhance their cloud experience. It is well-poised for growth in data-driven cloud networking business with proactive platforms and predictive operations. It offers one of the broadest product lines of datacenter and campus Ethernet switches and routers in the industry. Arista provides routing and switching platforms with industry-leading capacity, low latency, port density and power efficiency.
In addition to high capacity and easy availability, its cloud networking solutions promise predictable performance and programmability, enabling integration with third-party applications for network management, automation and orchestration. The company also innovates in areas such as deep packet buffers, embedded optics and reversible cooling. With customers deploying transformative cloud networking solutions, the company has announced several additions to its multi-cloud and cloud-native software product family with CloudEOS Edge.
End Note
With solid fundamentals and healthy revenue-generating potential driven by robust demand trends, Arista appears to be a solid investment proposition. However, it looks a bit expensive relative to its valuation metrics. Further, a strong emphasis on quality, diligent execution of operational plans and continuous portfolio enhancements are driving more value for customers. With improving earnings estimates, the stock is witnessing a positive investor perception.
Riding on a robust earnings surprise history and favorable Zacks Rank, it appears primed to record solid quarterly results in the ensuing earnings. Hence, investors are likely to profit if they bet on this high-flying stock now.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Shutterstock
Arista Networks Stock Before Q3 Earnings: To Buy or Not to Buy?
Arista Networks, Inc. (ANET - Free Report) is scheduled to report third-quarter 2024 earnings on Nov. 7, 2024. The Zacks Consensus Estimate for revenues and earnings is pegged at $1.76 billion and $2.09 per share, respectively. Earnings estimates for Arista have improved from $8.24 per share to $8.28 for 2024 and from $9.24 per share to $9.36 for 2025 over the past 60 days.
Find the latest EPS estimates and surprises on Zacks Earnings Calendar.
ANET Estimate Trend
Image Source: Zacks Investment Research
Earnings Surprise History
The communications components provider delivered a four-quarter earnings surprise of 15%, on average, beating estimates on each occasion. In the last reported quarter, the company pulled off an earnings surprise of 8.3%.
Image Source: Zacks Investment Research
Earnings Whispers
Our proven model predicts an earnings beat for Arista for the third quarter. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. This is perfectly the case here. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Arista currently has an ESP of +0.72% with a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.
Factors Shaping the Upcoming Results
Arista holds a leadership position in 100-gigabit Ethernet switching share in port for the high-speed datacenter segment. It is increasingly gaining market traction in 200- and 400-gig high-performance switching products.
The company is witnessing solid demand trends among enterprise customers backed by its multi-domain modern software approach, which is built upon its unique and differentiating foundation, the single EOS (Extensible Operating System) and CloudVision stack. The versatility of Arista’s unified software stack across various use cases, including WAN routing and campus and data center infrastructure, sets it apart from other competitors in the industry.
During the quarter, the company added significant new capabilities to its CloudVision platform to simplify network operations with automation, observability and zero trust security capabilities across all enterprise networking domains, from campus to data center, WAN and cloud. These included holistic, 360-degree observability by integrating application and third-party data into Arista’s unified Network Data Lake architecture. This, in turn, delivers superior application performance compared to more complex multi-tier networks while offering advanced monitoring capabilities, enabling a modern network operating model for customers.
The company also secured a $340 million deal from the Alabama Fiber Network, a consortium of eight electric cooperatives, to provide routing and switching equipment for the robust middle-mile network project throughout underserved rural areas across the region. The investment involves the deployment of Arista's high-performance 7280SR3 platform for seamless connectivity across diverse locations. These are likely to have generated incremental revenues in the quarter.
Price Performance
Over the past year, Arista has gained 85.2% compared with the industry’s growth of 78%, outperforming peers like Juniper Networks, Inc. (JNPR - Free Report) and Cisco Systems, Inc. (CSCO - Free Report) .
Image Source: Zacks Investment Research
Key Valuation Metric
From a valuation standpoint, Arista appears to be trading relatively expensive compared to the industry and above its mean. Going by the price/earnings ratio, the company shares currently trade at 42.88 forward earnings, higher than 34.66 for the industry and the stock’s mean of 32.85.
Image Source: Zacks Investment Research
Investment Considerations
Arista continues to benefit from strong momentum and diversification across its top verticals and product lines. The company has a software-driven, data-centric approach to help customers build their cloud architecture and enhance their cloud experience. It is well-poised for growth in data-driven cloud networking business with proactive platforms and predictive operations. It offers one of the broadest product lines of datacenter and campus Ethernet switches and routers in the industry. Arista provides routing and switching platforms with industry-leading capacity, low latency, port density and power efficiency.
In addition to high capacity and easy availability, its cloud networking solutions promise predictable performance and programmability, enabling integration with third-party applications for network management, automation and orchestration. The company also innovates in areas such as deep packet buffers, embedded optics and reversible cooling. With customers deploying transformative cloud networking solutions, the company has announced several additions to its multi-cloud and cloud-native software product family with CloudEOS Edge.
End Note
With solid fundamentals and healthy revenue-generating potential driven by robust demand trends, Arista appears to be a solid investment proposition. However, it looks a bit expensive relative to its valuation metrics. Further, a strong emphasis on quality, diligent execution of operational plans and continuous portfolio enhancements are driving more value for customers. With improving earnings estimates, the stock is witnessing a positive investor perception.
Riding on a robust earnings surprise history and favorable Zacks Rank, it appears primed to record solid quarterly results in the ensuing earnings. Hence, investors are likely to profit if they bet on this high-flying stock now.