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Is Arista Networks Inc. (NYSE: ANET) Doomed To Fail?

The trading price of Arista Networks Inc. (NYSE:ANET) floating lower at last check on Wednesday, May 24, closing at $139.98, -0.35% lower than its previous close.

Traders who pay close attention to intraday price movement should know that it has been fluctuating between $140.41 and $144.89. The company’s P/E ratio in the trailing 12-month period was 29.22, while its 5Y monthly beta was 1.26. In examining the 52-week price action we see that the stock hit a 52-week high of $171.44 and a 52-week low of $89.11. Over the past month, the stock has lost -8.86% in value.

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Arista Networks Inc., whose market valuation is $42.57 billion at the time of this writing, is expected to release its quarterly earnings report Jul 31, 2023 – Aug 04, 2023. Investors’ optimism about the company’s current quarter earnings report is understandable. Analysts have predicted the quarterly earnings per share to grow by $1.43 per share this quarter, however they have predicted annual earnings per share of $6.08 for 2023 and $6.7 for 2024. It means analysts are expecting annual earnings per share growth of 32.80% this year and 10.20% next year.

Analysts have forecast the company to bring in revenue of $1.38 billion for the current quarter, with the likely lows of $1.35 billion and highs of $1.39 billion. The average estimate suggests sales will likely up by 30.90% this quarter compared to what was recorded in the comparable quarter last year. From the analysts’ viewpoint, the consensus estimate for the company’s annual revenue in 2023 is $5.54 billion. The company’s revenue is forecast to grow by 26.40% over what it did in 2023.

A company’s earnings reviews provide a brief indication of a stock’s direction in the short term, where in the case of Arista Networks Inc. 1 upward and no downward comments were posted in the last 7 days. On the technical side, indicators suggest ANET has a 50% Sell on average for the short term. According to the data of the stock’s medium term indicators, the stock is currently averaging as a 50% Buy, while an average of long term indicators suggests that the stock is currently 50% Buy.

If we dig deeper into the stock’s outlook, we see that the stock’s PEG is 2.93, which symbolizes a positive outlook. A quick review shows that ANET’s price is currently -1.79% off the SMA20 and -9.33% off the SMA50. The RSI metric on the 14-day chart is currently showing 42.66, and weekly volatility stands at 3.20%. When measured over the past 30 days, the indicator reaches 3.00%. Arista Networks Inc. (NYSE:ANET)’s beta value is currently sitting at 1.28, while the Average True Range indicator is currently displaying 4.43.

To see how Arista Networks Inc. stock has been performing today in comparison to its peers in the industry, here are the numbers: ANET stock’s performance was -0.35% at last check in today’s session, and 36.83% in the past year, while Lantronix Inc. (LTRX) has been trading -1.09% in recent session and positioned -19.14% lower than it was a year ago. Another comparable company Silicom Ltd. (SILC) saw its stock trading 0.55% higher in today’s session but was down -4.22% in a year. Furthermore, HP Inc. (HPQ) showed a decrease of -1.93% today while its price kept declining at -14.52% over the past year. Arista Networks Inc. has a P/E ratio of 29.22. Also during today’s trading, the S&P 500 Index has plunged -0.88%, while the Dow Jones Industrial also saw a negative session, down -0.74% today.

An evaluation of the daily trading volume of Arista Networks Inc. (NYSE:ANET) indicates that the 3-month average is 2.83 million. However, this figure has increased over the past 10 days to an average of 2.39 million.

Currently, records show that 306.99 million of the company’s shares remain outstanding. The insiders hold 0.10% of outstanding shares, whereas institutions hold 67.90%. The stats also highlight that short interest as of Apr 27, 2023, stood at 4.04 million shares, resulting in a short ratio of 1.73 at that time. From this, we can conclude that short interest is 1.31% of the company’s total outstanding shares. It is noteworthy that short shares in April were up slightly from the previous month’s figure, which was 3.52 million. However, since the stock’s price has seen 15.35% year-to-date, investors’ interest is likely to be reignited due to its potential to move even higher.

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