Arista Networks (WBO:ANET) ROCE % : 33.21% (As of Dec. 2023)

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What is Arista Networks ROCE %?

ROCE % measures how well a company generates profits from its capital. It is calculated as EBIT divided by Capital Employed, where Capital Employed is calculated as Total Assets minus Total Current Liabilities. Arista Networks's annualized ROCE % for the quarter that ended in Dec. 2023 was 33.21%.

Arista Networks ROCE % Historical Data

The historical data trend for Arista Networks's ROCE % can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

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Arista Networks ROCE % Chart

Arista Networks Annual Data

Trend

Dec14

Dec15

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

ROCE %

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26.83

17.71

22.25

31.11

33.00

Arista Networks Quarterly Data
	Mar19	Jun19	Sep19	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23	Dec23
ROCE %	Get a 7-Day Free Trial															34.95	33.71	33.76	35.31	33.21

Arista Networks ROCE % Calculation

Arista Networks's annualized ROCE % for the fiscal year that ended in Dec. 2023 is calculated as:

ROCE %	=	EBIT	/	( (Capital Employed	+	Capital Employed)	/ count )
		(A: Dec. 2023 )		(A: Dec. 2022 )		(A: Dec. 2023 )
	=	EBIT	/	( ( (Total Assets - Total Current Liabilities)	+	(Total Assets - Total Current Liabilities) )	/ count )
		(A: Dec. 2023 )		(A: Dec. 2022 )		(A: Dec. 2023 )
	=	2069.897	/	( ( (6395.987 - 1221.093)	+	(9121.221 - 1751.109) )	/ 2 )
	=	2069.897	/	( (5174.894	+	7370.112)	/ 2 )
	=	2069.897	/	6272.503
	=	33.00 %

Arista Networks's ROCE % of for the quarter that ended in Dec. 2023 is calculated as:

ROCE %	=	EBIT ⁽¹⁾	/	( (Capital Employed	+	Capital Employed)	/ count )
		(Q: Dec. 2023 )		(Q: Sep. 2023 )		(Q: Dec. 2023 )
	=	EBIT	/	( ( (Total Assets - Total Current Liabilities)	+	(Total Assets - Total Current Liabilities) )	/ count )
		(Q: Dec. 2023 )		(Q: Sep. 2023 )		(Q: Dec. 2023 )
	=	2347.204	/	( ( (8497.686 - 1730.381)	+	(9121.221 - 1751.109) )	/ 2 )
	=	2347.204	/	( ( 6767.305	+	7370.112 )	/ 2 )
	=	2347.204	/	7068.7085
	=	33.21 %

(1) Note: The EBIT data used here is four times the quarterly (Dec. 2023) EBIT data.

Arista Networks (WBO:ANET) ROCE % Explanation

ROCE % can be especially useful when comparing the performance of capital-intensive companies. Unlike ROE %, which indicates the profitability of Shareholders Equity, ROCE % also considers long-term debt in Capital Employed. This can be helpful when analyzing companies with significant debt, as the result is neutralized by taking debt into consideration.

Generally speaking, a higher ROCE % indicates a stonger profitability for a company. Moreover, it is important to look at the ratio from a long term perspective. Investors tend to favor companies with stable and rising ROCE % trend over those with volatile ones.

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Arista Networks (WBO:ANET) Business Description

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Address

5453 Great America Parkway, Santa Clara, CA, USA, 95054

Website

https://www.arista.com

Arista Networks is a networking equipment provider that primarily sells Ethernet switches and software to data centers. Its marquee product is its extensible operating system, or EOS, that runs a single image across every single one of its devices. The firm operates as one reportable segment. It has steadily gained market share since its founding in 2004, with a focus on high-speed applications. Arista counts Microsoft and Meta Platforms as its largest customers and derives roughly three quarters of its sales from North America.