Key Stats for Arista Networks Stock
- Current Price: $126.68
- Target Price (Mid): $309.53
- Street Target: $176.46
- Potential Total Return: +144.3%
- Annualized IRR: 20.7% / year
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What Happened?
The AI infrastructure trade has rarely felt more uncomfortable to own. Arista Networks (ANET) sits 28.33% below its peak as of March 30, 2026, with its 52-week high of $164.94 now a distant reference point.
When the Trump administration announced sweeping new import tariffs on April 3, the stock fell another 11.1% in a session that saw the S&P 500 drop 4.9%.
Bulls argue that nothing in the fundamentals has changed; management, in fact, made the story better. Bears say a stock at 35.83x forward earnings has no margin for error.
The real question is whether a company guiding for 25% revenue growth in 2026 has been handed to investors at a discount.
On February 12, 2026, Arista reported Q4 2025 results that beat on every major line.
Revenue of $2.487 billion came in 4.18% above consensus. Per the earnings call, quarterly revenue grew 28.9% year over year, and net income exceeded $1 billion in a single quarter for the first time in the company’s history.
The stock rose 4.79% on the reporting date.
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Is Arista Networks Undervalued Today?
At $126.68, Arista trades at 35.83x NTM (next-twelve-months) earnings.
The bull case rests on AI networking demand that CEO Jayshree Ullal, Chairperson and Chief Executive Officer, called the “centers of data era” at the Morgan Stanley Technology, Media & Telecom Conference on March 3, 2026.
At that event, Ullal said Arista’s total addressable market has grown to approximately $105 billion, roughly double its prior estimate, as AI data center, campus, and WAN (wide area network) networking converge on a common Ethernet platform.
This is management’s own estimate, not a third-party figure.
On the Q4 earnings call, management raised its 2026 AI networking revenue guidance from $2.75 billion to $3.25 billion, targeting a doubling from the $1.5 billion delivered in 2025.
Full-year 2026 revenue guidance was lifted to approximately $11.25 billion, implying 25% growth. Purchase commitments rose to $6.8 billion from $4.8 billion in a single quarter, signaling customers are booking capacity well ahead of deployment.
The risks are real.
Memory prices are the sharpest near-term headwind. Ullal said on the Q4 earnings call that costs “have worsened significantly” entering 2026, and the company signaled a one-time price increase on memory-intensive product SKUs (individual hardware configurations).
TIKR data shows a 2026 estimated gross margin at 62.99%, below the 64.60% delivered for the full-year 2025. Tariffs add further uncertainty, though some analysts have noted that higher tariffs on Chinese networking hardware could reduce white-box competition and benefit Arista’s differentiated platform.
Cisco Systems (CSCO) trades at 13.59x NTM EV/EBITDA versus Arista’s 27.55x, per TIKR Competitors data. Cisco is primarily an installed-base maintenance business with limited AI exposure.
Arista has compounded revenue at 31.2% annually over five years while free cash flow scaled from $951 million in 2021 to $4.25 billion in 2025. The premium reflects that difference.
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TIKR Advanced Model Analysis
- Current Price: $126.68
- Target Price (Mid): $309.53
- Potential Total Return: +144.3%
- Annualized IRR: 20.7% / year
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The TIKR mid-case model targets $309.53 by 12/31/30, built on a 17.1% revenue CAGR and a 39.8% net income margin. The two revenue drivers are AI center networking, where Arista is targeting $3.25 billion in 2026 per management guidance, and enterprise campus expansion, which management is targeting at $1.25 billion in 2026. The margin driver is operating leverage from software and services. The primary model risk is multiple compression: the mid-case assumes P/E multiple declines of 1.5% annually, and further macro-driven valuation contraction could pressure the stock even if fundamentals hold.
In the high case, the TIKR model projects $662.84 by 12/31/30 at a 20.8% IRR, assuming Arista captures more AI infrastructure spending as 1.6T switching deployments accelerate. Ullal said on the Q4 earnings call that production-scale deployments in this category are expected primarily in 2027, meaning that catalyst is still roughly a year from becoming a meaningful revenue line item. The downside risk is straightforward: at 35.83x NTM P/E, any downward revision to earnings estimates gets punished quickly.
Conclusion: Watch gross margin in Arista’s next earnings report. Management guided 62% to 63% for Q1 2026, and a print below that range would signal memory cost absorption worse than expected. A result at or above the midpoint would confirm that tariff and supply chain concerns are already priced in at $126.68.
Arista is the most competitively positioned networking company in the AI infrastructure buildout, and a 28% drawdown in a market where hyperscaler AI capex is still rising has created the best entry point in over a year.
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Should You Invest in Arista Networks?
The only way to really know is to look at the numbers yourself. TIKR gives you free access to the same institutional-quality financial data that professional analysts use to answer exactly that question.
Pull up Arista Networks, and you’ll see years of historical financials, what Wall Street analysts expect for revenue and earnings in the quarters ahead, how valuation multiples have moved over time, and whether price targets are trending up or down.
You can build a free watchlist to track Arista Networks alongside every other stock on your radar. No credit card required. Just the data you need to decide for yourself.
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any stocks mentioned. Thank you for reading, and happy investing!
