Arista Networks (NYSE:ANET) Trading 1.7% Higher - Should You Buy?

Key Points

• Arista Networks' shares rose by 1.7% on Monday, trading at $119.62, with a notable drop in trading volume, down 72% from its average daily volume.
• Analysts are optimistic about Arista Networks, with Citigroup raising its price target from $112.00 to $123.00 and a consensus rating of "Moderate Buy".
• The company recently reported earnings of $0.65 EPS, exceeding estimates, alongside a substantial 27.6% year-over-year revenue growth of $2 billion for the quarter.

Arista Networks, Inc. (NYSE:ANET - Get Free Report) shares were up 1.7% on Monday . The company traded as high as $120.28 and last traded at $119.62. Approximately 2,979,132 shares changed hands during trading, a decline of 72% from the average daily volume of 10,521,352 shares. The stock had previously closed at $117.57.

Wall Street Analysts Forecast Growth

Several equities analysts have issued reports on the stock. Citigroup upped their price target on shares of Arista Networks from $112.00 to $123.00 and gave the company a "buy" rating in a research report on Friday, July 11th. BNP Paribas lowered Arista Networks from a "strong-buy" rating to a "hold" rating in a research report on Wednesday, June 11th. Wedbush began coverage on Arista Networks in a report on Wednesday, May 28th. They set an "outperform" rating on the stock. Needham & Company LLC initiated coverage on Arista Networks in a research note on Wednesday, May 28th. They issued a "buy" rating for the company. Finally, Rosenblatt Securities upped their target price on Arista Networks from $85.00 to $87.00 and gave the company a "neutral" rating in a report on Wednesday, May 7th. Six analysts have rated the stock with a hold rating and fourteen have assigned a buy rating to the company's stock. According to data from MarketBeat, Arista Networks currently has an average rating of "Moderate Buy" and an average target price of $114.00.

Arista Networks Price Performance

The company has a market capitalization of $151.00 billion, a P/E ratio of 50.89, a P/E/G ratio of 3.42 and a beta of 1.37. The stock's 50 day moving average is $101.48 and its 200-day moving average is $94.81.

Arista Networks (NYSE:ANET - Get Free Report) last announced its quarterly earnings results on Tuesday, May 6th. The technology company reported $0.65 earnings per share (EPS) for the quarter, beating analysts' consensus estimates of $0.59 by $0.06. Arista Networks had a return on equity of 30.48% and a net margin of 40.72%. The firm had revenue of $2 billion for the quarter, compared to the consensus estimate of $1.97 billion. During the same period in the prior year, the company posted $0.50 earnings per share. The company's quarterly revenue was up 27.6% on a year-over-year basis. On average, equities research analysts anticipate that Arista Networks, Inc. will post 2.2 EPS for the current year.

Arista Networks announced that its Board of Directors has initiated a stock repurchase plan on Tuesday, May 6th that allows the company to buyback $1.50 billion in outstanding shares. This buyback authorization allows the technology company to reacquire up to 1.3% of its shares through open market purchases. Shares buyback plans are often a sign that the company's management believes its shares are undervalued.

Insider Buying and Selling at Arista Networks

In other Arista Networks news, CEO Jayshree Ullal sold 748,444 shares of the stock in a transaction dated Monday, June 30th. The shares were sold at an average price of $102.43, for a total transaction of $76,663,118.92. Following the completion of the transaction, the chief executive officer owned 30,000 shares of the company's stock, valued at $3,072,900. This represents a 96.15% decrease in their position. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which is available at the SEC website. Also, SVP Kenneth Duda sold 80,000 shares of the stock in a transaction that occurred on Tuesday, May 6th. The shares were sold at an average price of $90.07, for a total value of $7,205,600.00. Following the transaction, the senior vice president directly owned 12,976 shares of the company's stock, valued at approximately $1,168,748.32. The trade was a 86.04% decrease in their ownership of the stock. The disclosure for this sale can be found here. Insiders sold 2,635,562 shares of company stock worth $291,955,743 in the last three months. Insiders own 3.54% of the company's stock.

Institutional Inflows and Outflows

Several institutional investors have recently added to or reduced their stakes in ANET. Vanguard Group Inc. increased its holdings in shares of Arista Networks by 1.8% during the first quarter. Vanguard Group Inc. now owns 97,856,933 shares of the technology company's stock valued at $7,581,955,000 after acquiring an additional 1,771,982 shares in the last quarter. FMR LLC raised its holdings in shares of Arista Networks by 330.9% in the fourth quarter. FMR LLC now owns 57,648,129 shares of the technology company's stock worth $6,371,848,000 after buying an additional 44,269,572 shares during the last quarter. Cresset Asset Management LLC increased its position in shares of Arista Networks by 277.5% in the 4th quarter. Cresset Asset Management LLC now owns 27,288,583 shares of the technology company's stock valued at $3,016,207,000 after acquiring an additional 20,059,303 shares during the period. Alliancebernstein L.P. raised its stake in Arista Networks by 9.0% in the 1st quarter. Alliancebernstein L.P. now owns 22,959,214 shares of the technology company's stock worth $1,778,880,000 after acquiring an additional 1,889,198 shares during the last quarter. Finally, Nuveen LLC purchased a new position in shares of Arista Networks in the first quarter worth about $933,626,000. Hedge funds and other institutional investors own 82.47% of the company's stock.

About Arista Networks

Arista Networks, Inc engages in the development, marketing, and sale of data-driven, client to cloud networking solutions for data center, campus, and routing environments in the Americas, Europe, the Middle East, Africa, and the Asia-Pacific. Its cloud networking solutions consist of Extensible Operating System (EOS), a publish-subscribe state-sharing networking operating system offered in combination with a set of network applications.

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