New York, January 6, 2026, 15:51 EST — Regular session
- Arista shares fell in afternoon trade, lagging a broader tech advance.
- Piper Sandler upgraded the stock to Overweight and lifted its price target.
- Investors are weighing AI data-center spending, competition and the next earnings catalyst.
Shares of Arista Networks (ANET) fell 2.9% to $133.25 in afternoon trading on Tuesday, after earlier reaching $138.47. Arista, valued at about $168 billion, trades at roughly 55 times trailing earnings. About 5.0 million shares had changed hands.
The stock is a proxy for investor appetite for the data-center networks that move traffic between servers, a market being reshaped by artificial intelligence. Some large money managers have started to look harder at valuation in AI-linked names; strategists at BlackRock Investment Institute wrote the backdrop was “ripe for active investing.” Reuters
Rates are part of the setup as well. Traders are watching Friday’s U.S. employment report for clues on the Federal Reserve path, with markets pricing in two rate cuts this year, a Reuters report said.
Piper Sandler on Jan. 5 upgraded Arista to Overweight from Neutral — a call that signals expected outperformance — and raised its price target to $159 from $145. Analyst James Fish dubbed 2026 a “Year of Refresh,” pointing to rising enterprise upgrades and Arista’s exposure to hyperscalers, the largest cloud operators, and to AI builds. He also said fears of share shifting to low-cost “white-box” switches — generic gear built by contract manufacturers — or to Nvidia’s networking products were easing, with Arista “holding share” at key data-center customers. TipRanks
Still, Arista trailed the tech complex on Tuesday. The Invesco QQQ Trust and the Technology Select Sector SPDR were up about 0.9% and 1.4%, respectively.
The competitive backdrop for data-center networking remains intense. Marvell Technology said on Tuesday it would buy networking equipment provider XConn in a roughly $540 million deal to broaden its portfolio for AI data centers, a segment where Nvidia and Broadcom are also pushing hard. Reuters
But Arista’s biggest customers can rein in capital spending quickly, and pricing pressure can build if rivals lean in on Ethernet switching. With the shares on a high multiple, even small cracks in demand can hit the stock fast.
The next test comes with Arista’s December-quarter report, expected on Feb. 17. Investors will watch for signals on cloud and enterprise demand and whether AI-related orders are accelerating or cooling.
