Here’s Why ClearBridge Investments Closed Out its Arista Networks (ANET) Position

ClearBridge Investments, an investment management firm, published its “Mid Cap Growth Strategy” third quarter 2021 investor letter – a copy of which can be downloaded here. During the third quarter, the ClearBridge Mid Cap Growth Strategy outperformed the benchmark Russell Midcap Growth Index. On an absolute basis, the Strategy had gains across seven of the 10 sectors in which it was invested during the quarter (out of 11 sectors total), with the IT and health care sectors the leading contributors. You can take a look at the fund’s top 5 holdings to have an idea about their best picks for 2021.

ClearBridge Mid Cap Growth Strategy, in its Q3 2021 investor letter, mentioned Arista Networks, Inc. (NYSE: ANET) and discussed its stance on the firm. Arista Networks, Inc. is a Santa Clara, California-based computer networking company with a $42.6 billion market capitalization. ANET delivered a -3.54% return since the beginning of the year, while its 12-month returns are up by 93.92%. The stock closed at $138.66 per share on January 04, 2022.

Here is what ClearBridge Mid Cap Growth Strategy has to say about Arista Networks, Inc.  in its Q3 2021 investor letter:

“On the sell side, we closed out of Arista Networks as its shares have reached what we consider full valuation after a rerating of the multiple on top of positive EPS revisions in the last 12 months. We also anticipate the potential for increased competition in high growth markets like cloud networking from Cisco Systems.”

Based on our calculations, Arista Networks, Inc. (NYSE: ANET) was not able to clinch a spot in our list of the 30 Most Popular Stocks Among Hedge Funds. ANET was in 32 hedge fund portfolios at the end of the third quarter of 2021, compared to 35 funds in the previous quarter. Arista Networks, Inc. (NYSE: ANET) delivered a 57.14% return in the past 3 months.

Earlier last year, we also shared another hedge fund’s views on ANET in another article. You can find more than 100 investor letters from hedge funds and prominent investors on our hedge fund investor letters 2021 Q3 page.

Disclosure: None. This article is originally published at Insider Monkey.