BofA-Merrill Lynch upgraded Arista Networks Inc (NYSE:ANET) stock to "buy" from "neutral," and reiterated its $300 price target -- a nearly 31% premium to Tuesday's close. The brokerage firm cited potential growth opportunity in new markets like routing and wireless LAN, given "management's excellent execution history."
As such, ANET stock is showing resilience during today's broad selling, up 1% at $231.99. The shares have been choppy this year, coming into 2018 trading near $235.60, and then breaking out to a then-record high above $311 in mid-February. The security pulled back to a short-term support in the $250 region -- home to an early January bull gap -- before hitting an all-time peak of $313.30 on Aug. 24. A sharp pullback from here was contained near $220, though subsequent rallies have been contained by that former floor and the equity's 50-day moving average.
Analysts are mostly upbeat toward the networking hardware name. While just under half of the 22 brokerages in coverage maintain a "hold" or "strong sell" rating, the average 12-month price target sits all the way up at $298.14.
Short sellers, meanwhile, have been exiting their bearish positions en masse. Short interest plunged 41.6% in the two most recent reporting periods, to 1.86 million shares. This represents a low 3.5% of ANET's available float, and would take roughly two days to cover, at the average pace of trading.