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Investing.com - JPMorgan has raised its price target on Arista Networks (NYSE:ANET) to $150.00 from $130.00 while maintaining an Overweight rating, citing the company’s increased fiscal year 2025 revenue growth guidance. The company, currently valued at $148.35 billion, has demonstrated strong financial performance with a "GREAT" health score according to InvestingPro metrics, though current analysis suggests the stock may be trading above its Fair Value.
Arista Networks recently boosted its FY25 revenue growth guidance from 17% to 25% year-over-year, addressing investor concerns about potential market share losses. This ambitious target builds on the company’s impressive 22.31% revenue growth over the last twelve months. The company also updated its AI back-end revenue targets to "$750 million+" from the previous estimate of approximately $750 million.
The networking equipment provider recorded its highest quarterly increase in deferred revenue of $687 million, bringing its deferred product revenue balance to $1.9 billion. JPMorgan notes this balance alone could contribute approximately 20 percentage points of growth to Arista’s 2025 revenue expectations of $8.75 billion.
Multiple growth drivers for 2026 include continued large GPU cluster deployments from existing Tier 1 customers, expansion with additional Tier 1 customers including Microsoft (NASDAQ:MSFT), broader adoption among 25-30 Tier 2 AI customers, front-end network upgrades, and robust growth in enterprise datacenter and campus segments. The company now expects campus revenue of $750-$800 million versus its prior $750 million target. InvestingPro data reveals 15+ additional insights about Arista’s growth potential and financial health, available in the comprehensive Pro Research Report.
Arista Networks has expressed confidence in reaching its $10 billion revenue target in 2026, two years ahead of its original 2028 plan, and has scheduled an analyst day for September 11 to provide more detailed insights into its growth outlook. The company’s strong execution is reflected in its impressive 46.03% return over the past year and robust financial metrics, including a healthy current ratio of 3.93.
In other recent news, Arista Networks reported impressive second-quarter results, with earnings per share reaching $0.73, surpassing the forecasted $0.65. The company also achieved revenue of $2.21 billion, exceeding the anticipated $2.1 billion. This performance marked a 30% year-over-year revenue growth, an increase of approximately 200 basis points compared to the previous quarter. Barclays (LON:BARC) responded by raising its price target for Arista Networks to $151, citing growth driven by artificial intelligence, while maintaining an Overweight rating. Goldman Sachs reiterated its Buy rating with a price target of $155, following the strong quarterly performance. Evercore ISI also increased its price target to $150, maintaining an Outperform rating. Arista Networks has revised its 2025 growth projection upward to 25% year-over-year. These developments highlight the company’s robust performance and optimistic growth outlook as noted by multiple analyst firms.
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