ARISTA NETWORKS INC (ANET) Stock Fundamental Analysis
USA - NYSE:ANET - US0404132054 - Common Stock
145.29 USD
-4.21 (-2.82%)
145.25 USD
-0.04 (-0.03%)
Overall ANET gets a fundamental rating of 7 out of 10. We evaluated ANET against 48 industry peers in the Communications Equipment industry. ANET gets an excellent profitability rating and is at the same time showing great financial health properties. ANET is valued quite expensively, but it does show have an excellent growth rating. With these ratings, ANET could be worth investigating further for growth and quality investing!.
1. Profitability
1.1 Basic Checks
In the past year ANET was profitable.
ANET had a positive operating cash flow in the past year.
In the past 5 years ANET has always been profitable.
ANET had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
ANET has a better Return On Assets (19.67%) than 97.92% of its industry peers.
The Return On Equity of ANET (29.83%) is better than 93.75% of its industry peers.
ANET's Return On Invested Capital of 23.84% is amongst the best of the industry. ANET outperforms 97.92% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for ANET is significantly above the industry average of 12.89%.
The last Return On Invested Capital (23.84%) for ANET is above the 3 year average (23.71%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 19.67% | ||
| ROE | 29.83% | ||
| ROIC | 23.84% |
ROA(3y)20.41%
ROA(5y)17.86%
ROE(3y)28.38%
ROE(5y)25.08%
ROIC(3y)23.71%
ROIC(5y)20.75%
1.3 Margins
ANET has a Profit Margin of 40.89%. This is amongst the best in the industry. ANET outperforms 100.00% of its industry peers.
In the last couple of years the Profit Margin of ANET has grown nicely.
The Operating Margin of ANET (43.14%) is better than 100.00% of its industry peers.
ANET's Operating Margin has improved in the last couple of years.
The Gross Margin of ANET (64.24%) is better than 87.50% of its industry peers.
ANET's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 43.14% | ||
| PM (TTM) | 40.89% | ||
| GM | 64.24% |
OM growth 3Y10.26%
OM growth 5Y4.7%
PM growth 3Y12.61%
PM growth 5Y2.7%
GM growth 3Y0.17%
GM growth 5Y0.02%
2. Health
2.1 Basic Checks
ANET has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it is creating value.
Compared to 1 year ago, ANET has more shares outstanding
The number of shares outstanding for ANET has been increased compared to 5 years ago.
There is no outstanding debt for ANET. This means it has a Debt/Equity and Debt/FCF ratio of 0 and it is amongst the best of the sector and industry.
2.2 Solvency
ANET has an Altman-Z score of 22.57. This indicates that ANET is financially healthy and has little risk of bankruptcy at the moment.
With an excellent Altman-Z score value of 22.57, ANET belongs to the best of the industry, outperforming 93.75% of the companies in the same industry.
ANET has no outstanding debt. Therefor its Debt/Equity and Debt/FCF ratios are 0 and belong to the best of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 0 | ||
| Altman-Z | 22.57 |
ROIC/WACC2.47
WACC9.67%
2.3 Liquidity
ANET has a Current Ratio of 3.33. This indicates that ANET is financially healthy and has no problem in meeting its short term obligations.
ANET has a Current ratio of 3.33. This is amongst the best in the industry. ANET outperforms 81.25% of its industry peers.
A Quick Ratio of 2.82 indicates that ANET has no problem at all paying its short term obligations.
The Quick ratio of ANET (2.82) is better than 79.17% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 3.33 | ||
| Quick Ratio | 2.82 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 31.50% over the past year.
The Earnings Per Share has been growing by 30.17% on average over the past years. This is a very strong growth
Looking at the last year, ANET shows a very strong growth in Revenue. The Revenue has grown by 25.97%.
Measured over the past years, ANET shows a very strong growth in Revenue. The Revenue has been growing by 23.77% on average per year.
EPS 1Y (TTM)31.5%
EPS 3Y46.94%
EPS 5Y30.17%
EPS Q2Q%39.05%
Revenue 1Y (TTM)25.97%
Revenue growth 3Y33.43%
Revenue growth 5Y23.77%
Sales Q2Q%30.43%
3.2 Future
ANET is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 19.41% yearly.
Based on estimates for the next years, ANET will show a quite strong growth in Revenue. The Revenue will grow by 19.59% on average per year.
EPS Next Y25.99%
EPS Next 2Y21.03%
EPS Next 3Y20.53%
EPS Next 5Y19.42%
Revenue Next Year25.58%
Revenue Next 2Y22.64%
Revenue Next 3Y21.65%
Revenue Next 5Y19.59%
3.3 Evolution
The estimated forward EPS growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 55.24, ANET can be considered very expensive at the moment.
The rest of the industry has a similar Price/Earnings ratio as ANET.
ANET's Price/Earnings ratio indicates a rather expensive valuation when compared to the S&P500 average which is at 27.76.
With a Price/Forward Earnings ratio of 43.65, ANET can be considered very expensive at the moment.
Compared to the rest of the industry, the Price/Forward Earnings ratio of ANET is on the same level as its industry peers.
Compared to an average S&P500 Price/Forward Earnings ratio of 23.21, ANET is valued quite expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 55.24 | ||
| Fwd PE | 43.65 |
4.2 Price Multiples
ANET's Enterprise Value to EBITDA is on the same level as the industry average.
The rest of the industry has a similar Price/Free Cash Flow ratio as ANET.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 45.94 | ||
| EV/EBITDA | 49.45 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
The excellent profitability rating of ANET may justify a higher PE ratio.
ANET's earnings are expected to grow with 20.53% in the coming years. This may justify a more expensive valuation.
PEG (NY)2.13
PEG (5Y)1.83
EPS Next 2Y21.03%
EPS Next 3Y20.53%
5. Dividend
5.1 Amount
No dividends for ANET!.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
145.29
-4.21 (-2.82%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupTechnology Hardware & Equipment
GICS IndustryCommunications Equipment
Earnings (Last)
Earnings (Next)
Inst Owners69.05%
Inst Owner Change0%
Ins Owners3.35%
Ins Owner Change-0.69%
Market Cap182.61B
Analysts82.42
Price Target156.27 (7.56%)
Short Float %1.21%
Short Ratio1.35
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Yearly DividendN/A
Dividend Growth(5Y)N/A
DPN/A
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)8.98%
Min EPS beat(2)7.74%
Max EPS beat(2)10.22%
EPS beat(4)4
Avg EPS beat(4)10.73%
Min EPS beat(4)7.74%
Max EPS beat(4)12.91%
EPS beat(8)8
Avg EPS beat(8)11.75%
EPS beat(12)12
Avg EPS beat(12)11.47%
EPS beat(16)16
Avg EPS beat(16)10.73%
Revenue beat(2)1
Avg Revenue beat(2)1.15%
Min Revenue beat(2)-0.26%
Max Revenue beat(2)2.55%
Revenue beat(4)2
Avg Revenue beat(4)0.89%
Min Revenue beat(4)-0.6%
Max Revenue beat(4)2.55%
Revenue beat(8)4
Avg Revenue beat(8)0.24%
Revenue beat(12)8
Avg Revenue beat(12)1.68%
Revenue beat(16)11
Avg Revenue beat(16)1.77%
PT rev (1m)8.98%
PT rev (3m)45.92%
EPS NQ rev (1m)0.63%
EPS NQ rev (3m)14.43%
EPS NY rev (1m)0.48%
EPS NY rev (3m)9.79%
Revenue NQ rev (1m)0.26%
Revenue NQ rev (3m)7.59%
Revenue NY rev (1m)0.28%
Revenue NY rev (3m)4.71%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 55.24 | ||
| Fwd PE | 43.65 | ||
| P/S | 22.97 | ||
| P/FCF | 45.94 | ||
| P/OCF | 45.12 | ||
| P/B | 16.75 | ||
| P/tB | 17.42 | ||
| EV/EBITDA | 49.45 |
EPS(TTM)2.63
EY1.81%
EPS(NY)3.33
Fwd EY2.29%
FCF(TTM)3.16
FCFY2.18%
OCF(TTM)3.22
OCFY2.22%
SpS6.33
BVpS8.67
TBVpS8.34
PEG (NY)2.13
PEG (5Y)1.83
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 19.67% | ||
| ROE | 29.83% | ||
| ROCE | 27.48% | ||
| ROIC | 23.84% | ||
| ROICexc | 81.79% | ||
| ROICexgc | 92.37% | ||
| OM | 43.14% | ||
| PM (TTM) | 40.89% | ||
| GM | 64.24% | ||
| FCFM | 50% |
ROA(3y)20.41%
ROA(5y)17.86%
ROE(3y)28.38%
ROE(5y)25.08%
ROIC(3y)23.71%
ROIC(5y)20.75%
ROICexc(3y)67.83%
ROICexc(5y)64.95%
ROICexgc(3y)77.58%
ROICexgc(5y)79.18%
ROCE(3y)27.32%
ROCE(5y)23.92%
ROICexcg growth 3Y3.57%
ROICexcg growth 5Y0.83%
ROICexc growth 3Y8.79%
ROICexc growth 5Y0.97%
OM growth 3Y10.26%
OM growth 5Y4.7%
PM growth 3Y12.61%
PM growth 5Y2.7%
GM growth 3Y0.17%
GM growth 5Y0.02%
F-Score6
Asset Turnover0.48
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 0 | ||
| Debt/EBITDA | 0 | ||
| Cap/Depr | 124.95% | ||
| Cap/Sales | 0.9% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 116.05% | ||
| Profit Quality | 122.26% | ||
| Current Ratio | 3.33 | ||
| Quick Ratio | 2.82 | ||
| Altman-Z | 22.57 |
F-Score6
WACC9.67%
ROIC/WACC2.47
Cap/Depr(3y)57.2%
Cap/Depr(5y)66.94%
Cap/Sales(3y)0.69%
Cap/Sales(5y)0.98%
Profit Quality(3y)85.94%
Profit Quality(5y)96.87%
High Growth Momentum
Growth
EPS 1Y (TTM)31.5%
EPS 3Y46.94%
EPS 5Y30.17%
EPS Q2Q%39.05%
EPS Next Y25.99%
EPS Next 2Y21.03%
EPS Next 3Y20.53%
EPS Next 5Y19.42%
Revenue 1Y (TTM)25.97%
Revenue growth 3Y33.43%
Revenue growth 5Y23.77%
Sales Q2Q%30.43%
Revenue Next Year25.58%
Revenue Next 2Y22.64%
Revenue Next 3Y21.65%
Revenue Next 5Y19.59%
EBIT growth 1Y31.8%
EBIT growth 3Y47.12%
EBIT growth 5Y29.59%
EBIT Next Year29.88%
EBIT Next 3Y22%
EBIT Next 5Y23.37%
FCF growth 1Y320.65%
FCF growth 3Y56.94%
FCF growth 5Y31.15%
OCF growth 1Y311.66%
OCF growth 3Y53.97%
OCF growth 5Y30.95%