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Quote this valuation with its source: Fair value, Potential value and the price at analysis.
FAQ
ANET — frequently asked questions
Is Arista Networks Inc. overvalued?
In our latest published analysis dated 2026-09-09, ANET looks meaningfully overvalued. The price recorded at analysis is 195 USD versus our fair value of 61,3 USD; the high endpoint is presented separately as potential value of 79,2 USD. That implies roughly 68.5% downside to fair value at that date.
Our latest published report, analyzed 2026-09-09, gives ANET a fair value of 61,3 USD and a potential value of 79,2 USD. The conclusion is triangulated across multiple valuation models and weighted by reliability for Arista Networks Inc.'s archetype; it is a dated research output, not a live price.
Should I buy ANET now?
Our latest published rating for ANET, analyzed 2026-09-09, is Sell. Arista Networks Inc. looks meaningfully overvalued at the analysis-date price of 195 USD versus fair value of 61,3 USD; potential value is 79,2 USD. This is research for educational purposes, not personalized investment advice.
What are the biggest risks for ANET?
The dedicated bear-case section in our report analyzed 2026-09-09 documents Arista Networks Inc.'s material risks, evidence, thresholds, and thesis-invalidation conditions. Scenario-specific explanations remain in that section so the report does not repeat or decontextualize them elsewhere.
What is ANET's rating?
Our latest published rating for ANET, analyzed 2026-09-09, is Sell, with a published moat assessment of 1/10 (None). It reflects our fair value of 61,3 USD, the potential value of 79,2 USD, and the price recorded at analysis (195 USD).
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§1 ZusammenfassungEN
30-Sekunden-AntwortSell
Preis im Verhältnis zum Wert
Kurs
$194.96
Fairer Wert
$61.32
Potenzialwert
$79.17
Stand
2026-09-08
Warum es funktionieren kann
Delivery above FY2027 revenue and adjusted-earnings estimates, with operating and free cash flow at or above FY2025's $4.37 billion and $4.25 billion, could extend growth and raise value per share.
Was unsere Einschätzung ändern würde
The key trigger is FY2027 company revenue below $14.12 billion, the low end of the analyst range as of 2026-09-09.
Sell. The report-date price stands above Fair value and Potential value. Reseller concentration can cut sales, while strong cash generation remains the clearest route to better results.4
The shares were assessed at a price above both public valuation points, leaving an unfavorable return profile even if near-term estimates are delivered.4
The main risk is a hypothetical revenue break from lower reseller orders, repricing, or product digestion. The FY2025 filing establishes concentration, not that these events are occurring. If they occur, sales, , earnings, and cash could fall.
The constructive case rests on FY2027 estimate delivery and continued strong cash generation. Together, they could extend growth and improve value per share.1,6
Cycle upside
The favorable path is demand-led. Delivery of FY2027 revenue and earnings estimates would extend product growth while strong cash generation funds required investment.1,6
Evidence-backed thesis
Sell because the report-date price exceeds Potential value while product and reseller concentration can shorten the growth runway.4,7
Cycle upside
The favorable path is demand-led. Delivery of FY2027 revenue and earnings estimates would extend product growth while strong cash generation funds required investment.1,6
Hausempfehlung
Sell because the report-date price exceeds Potential value. If either large reseller weakens, product-led sales could slow faster than the smaller service line can offset.4,7
Unternehmensüberblick
Arista’s cognitive campus portfolio was driven by customers seeking the same quality and operational efficiency available in the data center across their enterprise networks. Arista Networks, Inc. offers a robust set of solutions, ranging from modular and fixed-form-factor campus spine switches to Power-over-Ethernet ("PoE") leaf switches and Wi-Fi access points, all managed through CloudVision®. Arista Networks, Inc. offers multiple service options, allowing its customers to select the product replacement service level that best meets their needs.
Arista Networks, Inc. stocks spare parts in over 200 locations worldwide through its third-party logistics suppliers. All its service options include unlimited access to bug fixes, new-feature releases, online case management, and its community forums.
§2 BärenszenarioEN
The risks reinforce each other: weaker reseller demand reduces sales, lower volume pressures profit, and persistent investment consumes more cash. The standalone shocks should not be added together.
Product demand normalizes early, reseller weakness reaches consolidated sales, and margins or cash generation deteriorate.
This path is confirmed if FY2027 revenue falls below the analyst-range floor as of 2026-09-09. It is also confirmed if growth drops below the thesis floor before FY2029. The first breach lowers the modeled FY2027 sales base. The second signals slower growth, reducing incremental profit and cash without necessarily shrinking absolute revenue.
A breach would be consistent with weaker product purchases or lower reseller orders, without proving either cause. FY2025 product revenue was $7.58 billion versus $1.43 billion of service revenue, so a product shortfall would have limited offset and could reduce profit and cash.
Aktuell:The FY2027 analyst mean was $16.16 billion as of 2026-09-09.
The moat rating is None. The cited record does not establish Arista-specific switching costs, platform lock-in, distribution strength, or scale advantages. FY2025 operating income was $3.86 billion and free cash flow was $4.25 billion; these are outcomes, not structural protection.
DELL and SMCI are procurement-pricing cross-checks, while SNDK and WDC test broader hardware-budget pressure. Their economics differ, and direct network-product substitution is unproven.
Ökonomischer Gewinn
FY2025 operating income was $3.86 billion and free cash flow was $4.25 billion. These levels show realized economics for FY2025, but they do not establish switching costs or other structural protection.5,6
1/ 10
None
Bekannte Bedrohungen für den Wettbewerbsvorteil
Bedrohung
Schweregrad
Zeitrahmen
Minderung
Integrated-system pricing and hardware-budget competition could reduce sales or profit per sales dollar.
medium
Over the medium-term growth fade.
Judge the risk through Arista's own revenue and operating margin because the peer set has materially different economics and does not establish direct substitution.
The highlighted cell is Fair value when every assumption sits at its base level ($61.32). Each row and column shows what Fair value becomes when one assumption moves.
Free cash flow to the firm stays positive in the first projected year at $4.5B after modeled reinvestment of $63.8M, with terminal value at 69.6% of enterprise value. A sudden drop in free cash flow is not projected unless capital spending relative to revenue, reinvestment, or gross margin resets materially.
FY2027 revenue and adjusted earnings meet their dated estimates. Operating margin stays at or above its FY2025 level, and operating cash remains above reported profit.1,6
The base path holds if both dated FY2027 estimates are met and operating cash remains above reported profit. It fails if annual revenue growth breaches the thesis floor before FY2029.1,6
FY2027 revenue and adjusted earnings exceed their dated means. Operating margin stays at or above its FY2025 level, and operating cash remains above reported profit.
§7 Entscheidungsbaum für ErgebnisseEN
Übertroffen
Continue reducing exposure; do not chase a beat while $194.96 (as of 2026-09-08) remains above Potential value.
Auslöser: FY2027 revenue and adjusted earnings exceed their dated analyst means. Operating margin stays at or above its FY2025 reported level. Operating and free cash flow each stay at or above their FY2025 reported amounts.1,5,6
A beat would require FY2027 companywide revenue and adjusted earnings to exceed their dated analyst means. Operating margin should remain at or above FY2025's reported level. Operating and free cash flow should each remain at or above their FY2025 reported amounts.
Im Plan
Sell existing exposure under the Sell rating; do not retain a residual position solely because FY2027 estimates are met.
Auslöser: FY2027 companywide revenue and adjusted earnings meet their dated analyst means. Operating margin is at or above the FY2025 reported level. Operating and free cash flow are each at or above their FY2025 reported amounts.1,5,6
Meeting near-term estimates would preserve the thesis but would not establish the later growth duration.
Verfehlt
Exit remaining exposure if FY2027 revenue breaks the dated analyst-range floor.
Auslöser: FY2027 revenue falls below the dated range floor, or growth breaks the thesis floor before FY2029.
That miss would lower the explicit revenue base and shorten the product cycle.
Ergebnisqualität
FY2025 operating cash exceeded reported profit, but stock-based compensation remains a real cost to shareholders.6
FY2025 free cash flow—the cash left after capital spending—was $4.25 billion after $119.5 million of capex. This level shows funding capacity, but not the return earned on recent investment.5,6
Kapitalallokation
Capital spending rose from $32.0 million in FY2024 to $119.5 million in FY2025. FY2025 stock-based compensation was $439.2 million, so investment returns and share dilution remain relevant to value per share.
FY2025 operating profit was $3.86 billion and operating cash was $4.37 billion. Those one-year levels do not establish a dated return-on-invested-capital trend.
No same-basis comparison is made. The cited evidence establishes profit, cash, and the discount rate, not a comparable dated return series.
Reported profit converted strongly into cash during FY2025.
Arista Networks Inc. (ANET) trades at 36.9x forward earnings against a peer median of 11.3x. Its EV/EBITDA of 49.8x compares with a peer median of 20.4x. The comparison uses 4 peers: Sandisk Corporation, Dell Technologies Inc., Western Digital Corporation and Super Micro Computer Inc., as of 2026-09-09.
§10 Branche & ZyklusEN
Zyklusphase
Expansion
Capital spending rose between FY2024 and FY2025. The industry benchmark also shows spending above depreciation, supporting an expansion reading.6
Bullenzyklus
The demand-led favorable path requires FY2027 revenue and adjusted EPS to meet their 2026-09-09 estimates. FY2025 operating cash flow was $4.37 billion, while capex was $119.5 million, supporting capacity to cover that spending from operating cash.
Bärenzyklus
The adverse path begins when product demand normalizes faster than the smaller service business can offset. Sales then slow and operating leverage weakens.
Säkulare Trends
Trend
Auswirkung
Hinweis
Companywide sales and earnings expectations
positive
The FY2027 analyst estimates as of 2026-09-09 cover companywide revenue and adjusted earnings. Meeting them would support the favorable near-term cycle, but this dated evidence does not extend beyond FY2027.
Positionierung
Strong FY2025 cash generation supports self-funded investment, but reseller and product concentration make the cycle less diversified.5,7
§11 PositionsmanagementEN
Positionsgröße
Do not establish a new position while the report-date price remains above Potential value and the operating risks remain unresolved.4
Risiko
Sell existing exposure now because the report-date price exceeds Potential value. Use FY2027 revenue below $14.12 billion—the analyst-range floor as of 2026-09-09—as confirmation that the sales anchor failed. Two fiscal years below 35% operating margin or sustained capital spending above the stated threshold provide further confirmation.
Einstiegstranchen
Niveau
Aktion
Warum
Fair value or below
Reassess rather than buy automatically.
Require FY2027 estimate support, resilient margins, and continued cash generation before reconsidering.
Sell existing exposure now under the Sell rating. Continue using any FY2027 outlook below $14.12 billion as confirmation that the explicit sales anchor has failed.1
Reduce or exit rather than add; reseller concentration and product dependence can shorten the growth runway.7
Growth-focused investor
Avoid
Near-term estimates are strong, but dated support does not extend beyond FY2027.1
§14 Endgültige EmpfehlungEN
Aktion
Verkaufen
Sell because the report-date price stands above Fair value and Potential value, while the growth path remains exposed to product and reseller concentration.4,7
Strong cash generation supports the business, but it does not offset the valuation gap or prove that rapid growth will persist beyond FY2027.
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Sources
The records this analysis drew on, as they stood when it was run.
Not every cited input appears here: internal calculations and intermediate model outputs have no external record, and some citations could not be matched to one.
A breach would show sales growth slowing below the modeled path, consistent with earlier product digestion or lower reseller orders without proving either cause. Slower growth would reduce incremental profit and operating leverage, lowering earnings and cash versus the expected path.
Aktuell:The approved path expects 40.64% growth in FY2026 and 27.56% in FY2027.
Alarm, wennAnnual consolidated revenue growth drops below 15% in any fiscal year before FY2029.
Under this stress scenario, pricing, mix, or fixed-cost pressure would be worse than the expected fade. Less operating profit per sales dollar would lower earnings and cash.
Aktuell:FY2025 operating income of $3.86 billion on $9.01 billion of revenue supports a 42.82% margin.
Alarm, wennGAAP operating margin remains below 35% for two fiscal years.
04
Cash per profit dollar
The breach would make reported profit less useful for funding investment and shareholder returns. It would remove the main cash-based support for the favorable path.
Aktuell:FY2025 produced $1.25 of operating cash for each $1.00 of reported profit.
Alarm, wennOperating cash falls below $0.80 for each $1.00 of reported profit for one full fiscal year.
05
Capital spending intensity
Under this stress scenario, the investment phase would not normalize. More cash would remain tied up, lowering free cash flow without an evidenced revenue benefit from the spending.
Aktuell:Capital spending was 1.65 times depreciation in FY2025, with capex at $119.5 million.
Alarm, wennCapital spending remains at or above 2.0 times depreciation for two consecutive years after FY2026.
Limitation: Terminal value is 69.6% of this model's value, above the 60% level at which the methodology flags concentration; the value leans on the years beyond the explicit forecast.
The bull path needs FY2027 companywide revenue and adjusted earnings above their dated analyst means. Operating margin at or above FY2025's level and operating and free cash flow at or above FY2025 amounts would let higher sales lift profit and cash. It fades if product demand weakens and the smaller service line cannot offset lost sales.1,5,6,7
Warum es wichtig ist
Product digestion would reach consolidated sales faster than service could offset.7
03
Kennzahl:
Reseller concentration
AktuellFY2025 exposure remained concentrated.
Warum es wichtig ist
Lower orders remove sales, while repricing can reduce profit per sales dollar.7
Below the stress floor for consecutive fiscal years.
Reduce remaining exposure if GAAP operating margin stays below 35% for two fiscal years. That would exceed the expected fade from the FY2025 42.82% starting level.6
Capital spending intensity
At or above the escalation level for consecutive years after FY2026.
Avoid re-entry if capital spending remains at or above 2.0 times depreciation for two years after FY2026. The investment phase would not have normalized, and no separate sales benefit is assumed.
