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Investing.com - Barclays (LON:BARC) raised its price target on Arista Networks (NYSE:ANET) stock to $151.00 from $119.00 on Wednesday, while maintaining an Overweight rating following the company’s second-quarter earnings report. The networking equipment giant, now valued at $148.35 billion, maintains a "GREAT" financial health score according to InvestingPro analysis.
The networking equipment provider beat expectations in its second quarter and issued guidance for both the third quarter and fiscal year 2025 that exceeded market forecasts. Arista Networks revised its 2025 growth projection upward to 25% year-over-year, building on its impressive 22.31% revenue growth in the last twelve months.
The company also increased its campus segment forecast and now expects to surpass $1.5 billion in AI networking revenues for the year. Barclays noted that Arista’s strength was broad-based across AI, cloud, and enterprise segments.
Arista Networks demonstrated continued operational efficiency with improved inventory management and supply chain practices that positively impacted margins. These improvements contributed to the strong quarterly performance.
Barclays expressed confidence in Arista’s execution capabilities to achieve over $10 billion in revenues by 2026, adding that the company’s growth opportunity is widespread with potential upside to its long-term mid-teens revenue compound annual growth rate.
In other recent news, Arista Networks reported robust second-quarter results, with earnings per share reaching $0.73, surpassing the consensus estimate of $0.65. The company’s revenue also exceeded expectations, coming in at $2.21 billion compared to the anticipated $2.1 billion. This performance reflects a 30% year-over-year revenue growth, marking an acceleration of approximately 200 basis points from the previous quarter. Goldman Sachs reiterated its Buy rating on Arista Networks, maintaining a price target of $155.00, following these strong results. Evercore ISI also adjusted its price target for Arista Networks, raising it to $150.00 from $120.00, while maintaining an Outperform rating. These developments underscore the positive reception from analysts regarding Arista’s financial performance and growth prospects. The company’s strong quarterly results have been attributed, in part, to its growth in the AI sector. Investors and analysts alike have shown optimism about Arista Networks’ trajectory, as evidenced by the revised price targets and ratings.
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