Arista Networks (ANET) Analyst Day Highlights AI Data Center Growth and Cloud Integration

Arista Networks Inc (NYSE:ANET) is one of the AI Stocks Analysts Say You Should Watch Closely. On September 12, Rosenblatt analyst Mike Genovese raised the price target on the stock to $140.00 while maintaining a Neutral rating.

The price target raise follows Arista’s Analyst Day, where the company made a compelling case for maintaining leadership in the 100G and above Ethernet Networking market.

With AI data centers emerging, analysts at the firm believe that Arista’s basis of differentiation is transitioning from “operating system and programability to Cloud integration, telemetry, automation, network diagnostics capabilities, and power savings strategies.”

“We recognize Arista’s long track record of guiding conservatively, but were still slightly disappointed by the 2026 and beyond operating margin guidance of 43% to 45%, vs. 2024A and 2025E above 47%, and the 2026-2029 revenue CAGR in the mid-teens, compared to guidance to grow sales 25% in 2025 and 20% in 2026. To get to 20% revenue growth in 2026, management sees ~25% of its business, which is AI Data Center and Campus, expanding ~70%, while the other 75% of sales are roughly flat. In terms of margins, Arista is guiding for GMs to drop from 63% to 64% in 2025 to 62% to 64% in 2026, and to 60% to 64% after 2026 since AI Data Center is the fastest growing part of the business and the Cloud Titans get the most favorable pricing. The company is implying that Opex will grow significantly faster than sales in 2026, and nearly as fast as sales in 2027. We are increasing 2025 revenues to $10.5bn from $10.1bn, but our 2025 EPS forecast remains ~$3.10. We are also introducing 2027 revenues/EPS at $12.2bn/$3.50, and increasing our price target to $140 based on 40x 2027 EPS.”

Arista Networks Inc (NYSE:ANET) develops, markets, and sells cloud networking solutions.

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