Arista Networks (NYSE:ANET) Trading Down 2.5% Following Insider Selling

Key Points

• Arista Networks' stock fell by 2.5% following significant insider selling by CEO Jayshree Ullal, who sold nearly 1.5 million shares at an average price of around $122.
• The company's recent earnings report showed a 27.6% year-over-year revenue increase and earnings of $0.65 per share, surpassing expectations.
• Despite the recent stock drop, analysts maintain a generally positive outlook, with several upgrades recently, leading to an average rating of "Moderate Buy" for Arista Networks.

Shares of Arista Networks, Inc. (NYSE:ANET - Get Free Report) fell 2.5% during mid-day trading on Tuesday following insider selling activity. The company traded as low as $116.66 and last traded at $117.36. 3,174,947 shares traded hands during trading, a decline of 70% from the average session volume of 10,511,100 shares. The stock had previously closed at $120.35.

Specifically, Director Charles H. Giancarlo sold 8,000 shares of the company's stock in a transaction dated Friday, August 1st. The shares were sold at an average price of $117.01, for a total value of $936,080.00. Following the transaction, the director directly owned 57,784 shares in the company, valued at approximately $6,761,305.84. This represents a 12.16% decrease in their ownership of the stock. The transaction was disclosed in a document filed with the SEC, which is accessible through the SEC website. Also, CEO Jayshree Ullal sold 880,180 shares of the company's stock in a transaction dated Thursday, July 31st. The stock was sold at an average price of $124.79, for a total transaction of $109,837,662.20. Following the completion of the sale, the chief executive officer directly owned 5,944,405 shares of the company's stock, valued at approximately $741,802,299.95. This trade represents a 12.90% decrease in their ownership of the stock. The disclosure for this sale can be found here. In related news, CEO Jayshree Ullal sold 288,820 shares of the company's stock in a transaction dated Wednesday, July 30th. The shares were sold at an average price of $122.19, for a total value of $35,290,915.80. Following the completion of the sale, the chief executive officer directly owned 6,065,859 shares of the company's stock, valued at $741,187,311.21. This represents a 4.54% decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the Securities & Exchange Commission, which is available through the SEC website.

Analyst Upgrades and Downgrades

A number of research firms recently weighed in on ANET. Wolfe Research began coverage on shares of Arista Networks in a research note on Tuesday, July 8th. They issued an "outperform" rating for the company. Wedbush began coverage on shares of Arista Networks in a research note on Wednesday, May 28th. They issued an "outperform" rating for the company. BNP Paribas lowered shares of Arista Networks from a "strong-buy" rating to a "hold" rating in a research note on Wednesday, June 11th. KGI Securities lowered shares of Arista Networks to a "neutral" rating in a research note on Wednesday, May 7th. Finally, The Goldman Sachs Group upped their price objective on shares of Arista Networks from $115.00 to $155.00 and gave the stock a "buy" rating in a research note on Wednesday. Six investment analysts have rated the stock with a hold rating and fourteen have issued a buy rating to the company's stock. According to data from MarketBeat.com, the stock presently has an average rating of "Moderate Buy" and an average target price of $126.50.

Arista Networks Trading Up 17.1%

The stock has a market capitalization of $173.70 billion, a PE ratio of 58.57, a price-to-earnings-growth ratio of 3.50 and a beta of 1.37. The company's 50-day moving average is $102.57 and its 200 day moving average is $94.98.

Arista Networks (NYSE:ANET - Get Free Report) last announced its quarterly earnings data on Tuesday, August 5th. The technology company reported $0.73 EPS for the quarter, beating the consensus estimate of $0.65 by $0.08. The firm had revenue of $2.20 billion during the quarter, compared to analyst estimates of $2.11 billion. Arista Networks had a net margin of 40.72% and a return on equity of 30.48%. Arista Networks's revenue was up 30.4% on a year-over-year basis. During the same period last year, the firm posted $0.53 EPS. Sell-side analysts forecast that Arista Networks, Inc. will post 2.2 EPS for the current fiscal year.

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

Hedge Funds Weigh In On Arista Networks

A number of institutional investors have recently bought and sold shares of ANET. HighMark Wealth Management LLC raised its position in Arista Networks by 179.7% during the 1st quarter. HighMark Wealth Management LLC now owns 358 shares of the technology company's stock worth $28,000 after buying an additional 230 shares during the last quarter. Quarry LP raised its position in Arista Networks by 381.5% during the 4th quarter. Quarry LP now owns 260 shares of the technology company's stock worth $29,000 after buying an additional 206 shares during the last quarter. Dunhill Financial LLC raised its position in Arista Networks by 415.7% during the 4th quarter. Dunhill Financial LLC now owns 263 shares of the technology company's stock worth $29,000 after buying an additional 212 shares during the last quarter. Cloud Capital Management LLC purchased a new position in Arista Networks during the 1st quarter worth approximately $30,000. Finally, Saudi Central Bank acquired a new stake in shares of Arista Networks during the 1st quarter worth approximately $33,000. 82.47% of the stock is owned by hedge funds and other institutional investors.

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.