Arista Networks Posts 213.5% Upside Capture and 56.7% S&P Correlation
EXTR•Arista Networks’ five-year correlation with the S&P 500 sits at 56.7%, implying nearly half its returns derive from company-specific drivers such as AI and hyperscaler spending. Its annualized volatility of 47% alongside an Upside Capture ratio of 213.5% underscores aggressive bull-market participation supported by robust fundamentals.
1. Correlation Analysis
Over the past five years, Arista Networks has exhibited a 56.7% correlation with the S&P 500, indicating that roughly 43.3% of its price movements are influenced by unique company factors such as AI infrastructure demand and hyperscaler investments.
2. Performance Metrics
The stock’s annualized volatility of approximately 47% highlights its potential for significant upside and downside swings, while an Upside Capture ratio of 213.5% demonstrates that Arista historically outperforms the broader market more than twofold during market rallies.
3. Fundamental Drivers
Sustained spending on cloud networking, high-margin software subscriptions and accelerated AI data center deployments underpin Arista’s ability to deliver differentiated returns and justify its elevated participation in bullish market environments.
