* Note: Prices are in Million (M) USD.
Description:
Arista Networks (formerly Arastra) is an American computer networking company headquartered in Santa Clara, California. The company designs and sells multilayer network switches to deliver software-defined networking (SDN) solutions for large datacenter, cloud computing, high-performance computing, and high-frequency trading environments.
These criteria used Company's Cash, EBITDA and Debt balance to determines its fair value:
Cash : $1,845 M
Debt : $0 M
EBITDA : $3,204 M
Since Cash is greater than Total Debt, 5 points assigned.
This criteria used industry in which company operates:
Sector: Technology
Industry: Computer systems
Based on sector, 5 points assigned.
This criteria used Company's Price To Earning (P/E) Ratio to determines its fair value:
Forward PE Ratio: 46.42
Since Forward PE Ratio is greater than 35, 0 point assigned.
This criteria used Company's ability to convert Sales into free cash flow to determine fair value:
Using last 14 overlapping fiscal years (max 20).Average Free Cash Flow: $734 M
Average Revenue: $2,283 M
Revenue Converted To Free Cash Flow (%): 32.2%
Since Free Cash Flow (FCF) to Revenue percentage is greater than 25, 5 points assigned.
This criteria used company's growth potential to calculate its fair value:
Latest Revenue (2024-12-31): $7,003 M
Revenue 4 Years Ago (2020-12-31): $2,318 M
Last 5 Years Average Revenue Growth: 40%
Since Revenue Growth is greater than 20, 5 points assigned.
This criteria used Company's ability to buy back its own share:
Latest Share Count (2024-12-31): $1,281 M
Share Count 5 Years Ago (2020-12-31): $1,271 M
Company is not buying back its own shares, 0 points assigned.
This criteria used Company's dividend payout ratio to determine its fair value:
Next Year Earnings Per Share (EPS): $3.06
Trailing 12-Month Earnings Per Share (EPS): $2.81
Average Earnings Per Share (EPS): $2.94
Dividend Per Share (DPS): $0
Payout Ratio: 0%
Dividend Yield: 0%
Since Dividend Per Share is less than or equal to 0, 0 point assigned.
Since Dividend Yield is less than 1, 0 point assigned.
This criteria used Company's Return On Equity (ROE%) to determine its fair value:
Using last 13 valid ROE years (max 20).Average ROE: 31.6%
Since Average ROE is greater than 20, 5 points assigned.
This criteria used Company's current price to its 52 week low price to determines its fair value:
Current Price: $136
52-Week Low: $59
Threshold Price (15% Above 52-Week Low): $68
Since Current price is not within 15% threshold, 0 point assigned.
This criteria used Company's Market Cap to determines its fair value:
Market Capitalization: $153,335 M
Since Market Cap is between 100B - 500B, 3 points assigned.
% Exposure to Total Portfolio
Based on the market cap, we recommend do not exceed 4% exposure of Total Portfolio.
Value-Trade has assigned 28 points to above Arista Networks (ANET) stock.
Last 2 Years Avg PE 37.49, Fair Value PE 25, Industry Based PE 16, Growth Based PE 40, RCFC Based PE 35.72, ROE Based PE 35.29, Risk-Free Anchored PE (25% MoS) 17.08. Based on these 7 values, average assigned is 29.51. Value-Trades has assined P/E value 29.51. Since an average (Current Year EPS + Next Year EPS) earning per share is $2.935.
The fair value of Arista Networks (ANET) stock should be (29.51 x $2.935) = $86.62.
