Why Arista Networks Inc. (ANET) Crashed on Wednesday

We recently compiled a list of the Heavy Selling Drags Share Prices of These 10 Firms. In this article, we are going to take a look at where Arista Networks Inc. (NYSE:ANET) stands against the other stocks.

Wall Street’s major indices finished mixed on Wednesday, though generally pessimistic, as investor sentiment was dampened by higher-than-expected consumer price data which fueled concerns of a potential inflation rebound.

The Dow Jones and S&P 500 declined by 0.50 percent and 0.27 percent, respectively. Only Nasdaq posted gains, albeit a marginal 0.03 percent.

Among Wednesday’s losers, 10 companies were the worst performers, primarily due to disappointing earnings results, dismal outlook guidance, and downgraded ratings, among others. In this article, we have detailed the specific reasons behind their lagging performance.

To come up with Wednesday’s top losers, we considered only the stocks with at least $2 billion in market capitalization and $5 million in daily trading volume.

A technician in a server room managing a large-scale network of computers.

Arista Networks Inc. (NYSE:ANET)

Arista Networks Inc. fell for a second day on Wednesday, losing 6.16 percent to close at $109.64 apiece as analysts pointed to insider selling as having dragged down the company’s price, while also repositioning portfolios ahead of its earnings release next week.

On Tuesday, ANET Chief Technology Officer and Senior Vice President of Software Engineering Kenneth Duda disposed of $9.25 million in the company’s shares at prices ranging from $114.02 to $117.14 apiece. The sell-off came after ANET’s remarkable 70-percent return over the past year.

The company, however, did not confirm the reason behind the selling spree, further adding to investor worries.

On February 18, investors will be waiting for results of the company’s performance last year, as well as its outlook guidance for the rest of the year.

Overall ANET ranks 9th on our list of Wednesday’s top losers. While we acknowledge the potential of ANET as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than ANET but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

READ NEXT: 20 Best AI Stocks To Buy Now and Complete List of 59 AI Companies Under $2 Billion in Market Cap.

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