ANET
Arista Networks
Platform / Network
★ Quality 79/100Price today
$174.73
what the market pays
Worth
$84.24
calculated cycle value
Price is 107% above its value
charlieapp.co
Price vs Intrinsic Value
The line is the price month by month; the green band marks when it's undervalued (−20% off value). When the price drops in there, the discount is real, not opinion.
Where does the value come from?
Digital platform
$82.70
per share
How it's calculated
Arista Networks — high assistant confidence (2026-06-07). Review note.
Net cash in the bank
cash minus financial debt, per share
Total calculated value
business + cash
How many times the cash flow
Platform / Network · vs 27 peers
You pay 51.4x times this business's cash flow; its sector median is 26.1x.
52% above what Charlie thinks it's worth (24.5x) — you're overpaying, sector or no sector.
Why Overvalued?
Its free cash flow is $3.37/share × 24.5x multiplier plus $1.54 in net cash = $84.24 in intrinsic value. Today's price of $174.73 is 52% above the calculated value — the market is paying a premium over what the model sees as fair.
The price is 107% above the calculated value. You're paying more than it's worth.
Buying here lowers your expected return and wipes out the safety margin.
The next reasonable entry zone starts at $80.03.
At what price would buying make sense?
Entry zones
🟢 Undervalued
≤$67.39
-20% off Value
🟡 Discounted
≤$80.03
-5% off Value
🔴 Today
$174.73
-52% Valor
Overvalued
The market prices it too high versus what the business makes. Patience pays off here.
“Time is the friend of the wonderful company, the enemy of the mediocre.”
— Warren Buffett
Model updated · July 2026
The business
Arista builds the internal highways of AI data centers.
Arista sells high-speed network switches for hyperscale data centers and, increasingly, for AI clusters. It charges for hardware plus licenses of its EOS operating system. In 2025 it booked $9.0B in revenue with a 64% gross margin and $4.3B in FCF.
EOS is a single software operating system that runs across its entire lineup, with clean code and none of Cisco's technical debt. That cuts bugs and operating costs for customers like Microsoft and Meta, who account for a big chunk of sales. The advantage is real but narrow: it depends on a few giant customers who can design their own silicon.
Revenue history
From $2.9B to $9.0B in 4 years — nearly 3.1x its size. Selling more and more is the base of everything else.
Where each $100 of sales goes
Revenue $9.0B · FY2025
Of every $100 in sales, $61 goes to costs and operations; $39 is left as net profit (39% margin).
Catalysts and risks
AI network spending: Arista targets $750M in AI back-end revenue in 2025, scaling into 2026.
Migration from 400G to 800G in hyperscale during 2025-2026.
Expansion to enterprise customers beyond the hyperscalers, diversifying the $9.0B base.
Brutal concentration: Microsoft and Meta carry too much weight. If they build their own switching, the model suffers.
Broadcom supplies its silicon. With no chip of its own, its fate depends on a single vendor.
Perfect-growth valuation: at 24.5x normalized FCF, a soft quarter hurts.
Charlie's note
“At 24.54x for a business growing 32% with a 64% gross margin, you're paying a sensible multiple for this quality; the nuance is that the EOS moat, though real, rests on a handful of giants capable of building their own silicon. Patience with the customer concentration.”
Analysis · June 2026
So when would be a good price for Arista Networks?
By our calculation, not yet. We will email you the day it drops to $80.03 — so you do not have to keep checking.
🔔 Email meFree · no card
Charlie informs, it doesn't advise. No information should be taken as a recommendation to buy or sell.