NYSE:ANET—Positioned as a High-Growth Stock, Ready for a Potential Breakout.

In this article we will dive into ARISTA NETWORKS INC (NYSE:ANET) as a possible candidate for growth investing. Investors should always do their own research, but we noticed ARISTA NETWORKS INC showing up in our strong growth, ready to breakout screen, which makes it worth to investigate a bit more.

ChartMill's Evaluation of Growth

ChartMill assigns a Growth Rating to each stock, ranging from 0 to 10. This rating is determined by analyzing different growth elements, including EPS and revenue growth, spanning both historical and future figures. In the case of NYSE:ANET, the assigned 8 reflects its growth potential:

• ANET shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 41.09%, which is quite impressive.
• The Earnings Per Share has been growing by 28.34% on average over the past years. This is a very strong growth
• The Revenue has grown by 19.93% in the past year. This is quite good.
• ANET shows a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 22.19% yearly.
• The Earnings Per Share is expected to grow by 18.23% on average over the next years. This is quite good.
• ANET is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 17.26% yearly.

Analyzing Health Metrics

ChartMill assigns a proprietary Health Rating to each stock. The score is computed by evaluating various liquidity and solvency ratios and ranges from 0 to 10. NYSE:ANET was assigned a score of 9 for health:

• ANET has an Altman-Z score of 26.53. This indicates that ANET is financially healthy and has little risk of bankruptcy at the moment.
• ANET has a Altman-Z score of 26.53. This is amongst the best in the industry. ANET outperforms 100.00% of its industry peers.
• 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.
• ANET has a Current Ratio of 4.55. This indicates that ANET is financially healthy and has no problem in meeting its short term obligations.
• The Current ratio of ANET (4.55) is better than 90.20% of its industry peers.
• A Quick Ratio of 3.70 indicates that ANET has no problem at all paying its short term obligations.
• With an excellent Quick ratio value of 3.70, ANET belongs to the best of the industry, outperforming 90.20% of the companies in the same industry.

Profitability Insights: NYSE:ANET

ChartMill employs its own Profitability Rating system for stock evaluation. This score, ranging from 0 to 10, is derived from an analysis of diverse profitability metrics and margins. In the case of NYSE:ANET, the assigned 9 is noteworthy for profitability:

• ANET's Return On Assets of 21.18% is amongst the best of the industry. ANET outperforms 98.04% of its industry peers.
• With an excellent Return On Equity value of 29.20%, ANET belongs to the best of the industry, outperforming 96.08% of the companies in the same industry.
• ANET's Return On Invested Capital of 23.61% is amongst the best of the industry. ANET outperforms 96.08% of its industry peers.
• ANET had an Average Return On Invested Capital over the past 3 years of 21.73%. This is significantly above the industry average of 10.11%.
• The 3 year average ROIC (21.73%) for ANET is below the current ROIC(23.61%), indicating increased profibility in the last year.
• Looking at the Profit Margin, with a value of 39.01%, ANET belongs to the top of the industry, outperforming 100.00% of the companies in the same industry.
• ANET's Profit Margin has improved in the last couple of years.
• ANET has a Operating Margin of 41.23%. This is amongst the best in the industry. ANET outperforms 100.00% of its industry peers.
• In the last couple of years the Operating Margin of ANET has grown nicely.
• The Gross Margin of ANET (64.01%) is better than 86.27% of its industry peers.

Why is NYSE:ANET a setup?

In addition to the Technical Rating, ChartMill provides a Setup Rating for each stock. This rating, ranging from 0 to 10, assesses the extent of consolidation in the stock based on multiple short-term technical indicators. Currently, NYSE:ANET has a 8 as its setup rating:

Besides having an excellent technical rating, ANET also presents a decent setup pattern. Prices have been consolidating lately. There is a support zone below the current price at 400.18, a Stop Loss order could be placed below this zone.

More Strong Growth stocks can be found in our Strong Growth screener.

Check the latest full fundamental report of ANET for a complete fundamental analysis.

Check the latest full technical report of ANET for a complete technical analysis.

Disclaimer

This article should in no way be interpreted as advice. The article is based on the observed metrics at the time of writing, but you should always make your own analysis and trade or invest at your own responsibility.