As of August 25, 2026, Arista Networks Inc has a Discounted Cash Flow (DCF) derived fair value of $214.79 per share. With the current market price at $188.15, this represents a potential upside of 14.2%.
| Key Metrics | Value |
|---|---|
| DCF Fair Value (5-year) | $144.49 |
| DCF Fair Value (10-year) | $214.79 |
| Potential Upside (5-year) | -23.2% |
| Potential Upside (10-year) | 14.2% |
| Discount Rate (WACC) | 5.9% - 8.1% |
Revenue is projected to grow from $9006 million in 12-2025 to $31921 million by 12-2035, representing a compound annual growth rate of approximately 13.5%.
| Fiscal Year | Revenue (USD millions) | Growth |
|---|---|---|
| 12-2025 | 9006 | 29% |
| 12-2026 | 10573 | 17% |
| 12-2027 | 12373 | 17% |
| 12-2028 | 14396 | 16% |
| 12-2029 | 16304 | 13% |
| 12-2030 | 18441 | 13% |
| 12-2031 | 21055 | 14% |
| 12-2032 | 23661 | 12% |
| 12-2033 | 26246 | 11% |
| 12-2034 | 28746 | 10% |
| 12-2035 | 31921 | 11% |
Net profit margin is expected to improve from 39% in 12-2025 to 49% by 12-2035, driven by operational efficiency and economies of scale.
| Fiscal Year | Net Profit (USD millions) | Profit Margin |
|---|---|---|
| 12-2025 | 3511 | 39% |
| 12-2026 | 4464 | 42% |
| 12-2027 | 5405 | 44% |
| 12-2028 | 6491 | 45% |
| 12-2029 | 7568 | 46% |
| 12-2030 | 8792 | 48% |
| 12-2031 | 10089 | 48% |
| 12-2032 | 11393 | 48% |
| 12-2033 | 12700 | 48% |
| 12-2034 | 13976 | 49% |
| 12-2035 | 15593 | 49% |
with a 5-year average of $59 million. Projected CapEx is expected to maintain at approximately 1% of revenue.
Depreciation is based on an average useful life of 5 years for capital assets.
| Fiscal Year | D&A (USD millions) |
|---|---|
| 12-2026 | 70 |
| 12-2027 | 88 |
| 12-2028 | 114 |
| 12-2029 | 144 |
| 12-2030 | 161 |
| 12-2031 | 185 |
Net working capital is expected to increase gradually, with projected changes affecting free cash flow.
| Components | Average Days |
|---|---|
| Days Receivables | 67 |
| Days Inventory | 279 |
| Days Payables | 67 |
| Fiscal Year | EBITDA | Tax | CapEx | Change in NWC | FCF |
|---|---|---|---|---|---|
| 6M/2026 | 2400 | 358 | 59 | 278 | 1704 |
| 2027 | 5834 | 867 | 138 | 465 | 4364 |
| 2028 | 7032 | 1041 | 161 | 674 | 5156 |
| 2029 | 8231 | 1213 | 182 | 537 | 6298 |
| 2030 | 9578 | 1410 | 206 | 581 | 7381 |
| Valuation Method | Fair Price (USD) | Potential Upside |
|---|---|---|
| 5-Year DCF (Growth) | 144.49 | -23.2% |
| 10-Year DCF (Growth) | 214.79 | 14.2% |
| 5-Year DCF (EBITDA) | 144.68 | -23.1% |
| 10-Year DCF (EBITDA) | 211.46 | 12.4% |
Is Arista Networks Inc (ANET) a buy or a sell? Arista Networks Inc is definitely a buy. Based on our DCF analysis, Arista Networks Inc (ANET) appears to be moderately undervalued with upside potential of 14.2%. The company's strong projected growth in revenue and profitability, coupled with consistent capital expenditure, supports our positive outlook on its intrinsic value.
Key investment drivers include:
Investors should consider a buy at the current market price of $188.15.