ARISTA NETWORKS INC (NYSE:ANET) – A Strong Contender for CANSLIM Investors

ARISTA NETWORKS INC (NYSE:ANET) stands out as a potential candidate for investors following the CANSLIM strategy. The company’s strong earnings growth, solid fundamentals, and technical momentum align well with the criteria outlined by William O’Neil’s methodology. Below, we examine why ANET fits the CANSLIM framework.

Key CANSLIM Criteria Met by ANET

• C – Current Earnings & Sales Growth: ANET reported a 30.7% year-over-year increase in quarterly EPS and a 27.6% rise in revenue, comfortably exceeding the CANSLIM threshold of 20-25% growth.
• A – Annual Earnings Growth: The company’s 3-year EPS growth rate of 46.9% demonstrates sustained profitability, well above the 25% minimum requirement.
• N – New Highs & Innovation: ANET operates in cloud networking, a high-growth sector, and has shown strong price momentum, trading near its recent highs.
• S – Supply & Demand: With no debt and a healthy liquidity position (current ratio of 3.93), ANET maintains a strong balance sheet.
• L – Market Leadership: The stock’s relative strength of 85.7 places it in the top 15% of performers, a key trait for CANSLIM stocks.
• I – Institutional Sponsorship: Institutional ownership stands at 69.6%, indicating interest from larger investors without being overly saturated.
• M – Market Direction: The S&P 500’s positive trends support a favorable environment for growth stocks like ANET.

Fundamental & Technical Overview

ANET’s fundamental report highlights outstanding profitability (ROE of 29.9%) and strong margins, though its valuation appears elevated. The technical analysis shows a positive short-term trend, with the stock trading near the upper end of its recent range.

For more CANSLIM-compliant stocks, explore our predefined screener.

Disclaimer

This is not investing advice! The article highlights observations at the time of writing, but you should conduct your own research before making investment decisions.