Is Arista Networks, Inc. overvalued or undervalued?

As of 17 October 2025, the valuation grade for Arista Networks, Inc. moved from expensive to fair, indicating a shift in its perceived value. Based on the current metrics, the company appears to be fairly valued. Key ratios include a P/E ratio of 40, an EV to EBITDA of 35.58, and a Price to Book Value of 12.07. In comparison, its peer, which has a P/E ratio of 54.30, suggests that Arista may be more attractively priced relative to its competition.
Despite recent challenges, such as a 7.14% decline in the past week compared to a 1.70% gain in the S&P 500, Arista has shown strong performance year-to-date with a return of 29.47% versus the S&P 500's 13.30%. This performance, along with its robust ROCE of 159.60% and ROE of 29.82%, reinforces the notion that Arista Networks, Inc. is fairly valued in the current market landscape.