Morgan Stanley Issues Pessimistic Forecast for Arista Networks (NYSE:ANET) Stock Price

Key Points

• Morgan Stanley cut its price target for Arista to $159 from $171 but kept an "overweight" rating, a target that implies about a 26% upside from the stock's previous close.
• Arista's latest quarter beat expectations with $0.75 EPS (vs. $0.72 est.) and $2.31B revenue (vs. $2.26B est.), with revenue up 27.5% year-over-year and strong margins, supporting solid fundamentals.
• Significant insider selling occurred recently — including the CEO and a director — with insiders selling 218,464 shares (~$30.3M) in the past three months and the CEO's direct ownership falling ~70.8% after her sale.

Arista Networks (NYSE:ANET - Get Free Report) had its price objective lowered by research analysts at Morgan Stanley from $171.00 to $159.00 in a research note issued on Wednesday,Benzinga reports. The firm currently has an "overweight" rating on the technology company's stock. Morgan Stanley's target price would suggest a potential upside of 26.03% from the company's previous close.

Several other equities analysts have also weighed in on the stock. Barclays reissued an "overweight" rating and issued a $183.00 price objective (up from $179.00) on shares of Arista Networks in a research report on Wednesday, November 5th. UBS Group reissued a "buy" rating and issued a $155.00 price target on shares of Arista Networks in a report on Wednesday, December 3rd. JPMorgan Chase & Co. boosted their price objective on Arista Networks from $150.00 to $175.00 and gave the stock an "overweight" rating in a report on Friday, September 12th. Evercore ISI upped their target price on Arista Networks from $150.00 to $175.00 and gave the company an "outperform" rating in a research report on Friday, September 12th. Finally, Rosenblatt Securities reiterated a "neutral" rating and set a $140.00 target price on shares of Arista Networks in a research note on Monday, November 24th. Seventeen equities research analysts have rated the stock with a Buy rating and six have issued a Hold rating to the company. Based on data from MarketBeat, the company currently has a consensus rating of "Moderate Buy" and a consensus target price of $163.56.

Arista Networks Trading Up 0.2%

Shares of NYSE ANET opened at $126.17 on Wednesday. The company has a market capitalization of $158.88 billion, a P/E ratio of 47.97, a P/E/G ratio of 2.41 and a beta of 1.41. Arista Networks has a 12 month low of $59.43 and a 12 month high of $164.94. The stock has a 50 day moving average of $138.11 and a 200-day moving average of $127.48.

Arista Networks (NYSE:ANET - Get Free Report) last posted its quarterly earnings results on Tuesday, November 4th. The technology company reported $0.75 earnings per share for the quarter, beating analysts' consensus estimates of $0.72 by $0.03. Arista Networks had a return on equity of 30.28% and a net margin of 39.73%.The business had revenue of $2.31 billion for the quarter, compared to analysts' expectations of $2.26 billion. During the same quarter in the prior year, the business earned $2.40 EPS. The firm's revenue for the quarter was up 27.5% on a year-over-year basis. Analysts predict that Arista Networks will post 2.2 EPS for the current fiscal year.

Insider Buying and Selling at Arista Networks

In other Arista Networks news, Director Charles H. Giancarlo sold 8,000 shares of the firm's stock in a transaction on Monday, December 1st. The stock was sold at an average price of $128.09, for a total transaction of $1,024,720.00. Following the transaction, the director owned 25,784 shares in the company, valued at $3,302,672.56. This trade represents a 23.68% decrease in their position. The transaction was disclosed in a legal filing with the Securities & Exchange Commission, which is available at the SEC website. Also, CEO Jayshree Ullal sold 24,042 shares of Arista Networks stock in a transaction on Tuesday, November 25th. The shares were sold at an average price of $124.55, for a total value of $2,994,431.10. Following the completion of the transaction, the chief executive officer directly owned 9,917 shares of the company's stock, valued at $1,235,162.35. This represents a 70.80% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. Insiders have sold a total of 218,464 shares of company stock valued at $30,309,988 in the last three months. Corporate insiders own 3.54% of the company's stock.

Institutional Trading of Arista Networks

Several large investors have recently modified their holdings of ANET. Vanguard Group Inc. lifted its position in Arista Networks by 1.0% during the third quarter. Vanguard Group Inc. now owns 100,000,830 shares of the technology company's stock worth $14,571,121,000 after purchasing an additional 1,007,730 shares during the period. State Street Corp raised its position in shares of Arista Networks by 0.5% in the 3rd quarter. State Street Corp now owns 46,342,551 shares of the technology company's stock valued at $6,752,573,000 after buying an additional 245,976 shares in the last quarter. Cresset Asset Management LLC lifted its holdings in shares of Arista Networks by 1.0% during the 2nd quarter. Cresset Asset Management LLC now owns 26,374,373 shares of the technology company's stock worth $2,698,362,000 after acquiring an additional 263,272 shares during the period. Geode Capital Management LLC lifted its holdings in shares of Arista Networks by 0.5% during the 2nd quarter. Geode Capital Management LLC now owns 25,576,483 shares of the technology company's stock worth $2,606,694,000 after acquiring an additional 128,977 shares during the period. Finally, Alliancebernstein L.P. boosted its position in shares of Arista Networks by 9.0% during 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 in the last quarter. 82.47% of the stock is owned by institutional investors and hedge funds.

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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