Here's Why Arista Networks (ANET) is a Great Momentum Stock to Buy

Momentum investing revolves around the idea of following a stock's recent trend in either direction. In the 'long' context, investors will be essentially be "buying high, but hoping to sell even higher." With this methodology, taking advantage of trends in a stock's price is key; once a stock establishes a course, it is more than likely to continue moving that way. The goal is that once a stock heads down a fixed path, it will lead to timely and profitable trades.While many investors like to look for momentum in stocks, this can be very tough to define. There is a lot of debate surrounding which metrics are the best to focus on and which are poor quality indicators of future performance. The Zacks Momentum Style Score, part of the Zacks Style Scores, helps address this issue for us.Below, we take a look at Arista Networks (ANET), a company that currently holds a Momentum Style Score of B. We also talk about price change and earnings estimate revisions, two of the main aspects of the Momentum Style Score.It's also important to note that Style Scores work as a complement to the Zacks Rank, our stock rating system that has an impressive track record of outperformance. Arista Networks currently has a Zacks Rank of #2 (Buy). Our research shows that stocks rated Zacks Rank #1 (Strong Buy) and #2 (Buy) and Style Scores of A or B outperform the market over the following one-month period.You can see the current list of Zacks #1 Rank Stocks here >>>Set to Beat the Market?In order to see if ANET is a promising momentum pick, let's examine some Momentum Style elements to see if this cloud networking company holds up.A good momentum benchmark for a stock is to look at its short-term price activity, as this can reflect both current interest and if buyers or sellers currently have the upper hand. It's also helpful to compare a security to its industry; this can show investors the best companies in a particular area.For ANET, shares are up 6.7% over the past week while the Zacks Communication - Components industry is up 0.68% over the same time period. Shares are looking quite well from a longer time frame too, as the monthly price change of 5.96% compares favorably with the industry's 3.63% performance as well.While any stock can see a spike in price, it takes a real winner to consistently outperform the market. Shares of Arista Networks have increased 16.12% over the past quarter, and have gained 82.34% in the last year. On the other hand, the S&P 500 has only moved 10.27% and 32.66%, respectively.Investors should also pay attention to ANET's average 20-day trading volume. Volume is a useful item in many ways, and the 20-day average establishes a good price-to-volume baseline; a rising stock with above average volume is generally a bullish sign, whereas a declining stock on above average volume is typically bearish. ANET is currently averaging 8,225,567 shares for the last 20 days.Earnings OutlookThe Zacks Momentum Style Score encompasses many things, including estimate revisions and a stock's price movement. Investors should note that earnings estimates are also significant to the Zacks Rank, and a nice path here can be promising. We have recently been noticing this with ANET.Over the past two months, 7 earnings estimates moved higher compared to none lower for the full year. These revisions helped boost ANET's consensus estimate, increasing from $2.06 to $2.18 in the past 60 days. Looking at the next fiscal year, 6 estimates have moved upwards while there have been 1 downward revision in the same time period.Bottom LineTaking into account all of these elements, it should come as no surprise that ANET is a #2 (Buy) stock with a Momentum Score of B. If you've been searching for a fresh pick that's set to rise in the near-term, make sure to keep Arista Networks on your short list.Only $1 to See All Zacks' Buys and SellsWe're not kidding.Several years ago, we shocked our members by offering them 30-day access to all our picks for the total sum of only $1. No obligation to spend another cent.Thousands have taken advantage of this opportunity. Thousands did not - they thought there must be a catch. Yes, we do have a reason. We want you to get acquainted with our portfolio services like Surprise Trader, Stocks Under $10, Technology Innovators,and more, that closed 228 positions with double- and triple-digit gains in 2023 alone.See Stocks Now >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Arista Networks, Inc. (ANET): Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks