CLS vs. ANET: Which AI Stock Offers the Better Growth Opportunity?

Per a report from Precedence Research, the AI infrastructure market, which was valued at $72.2 billion in 2025, is projected to reach $518.26 billion by 2035 with a market CAGR of 21.82%. Celestica and Arista operate in different domains of the broader AI infrastructure space. Let’s delve deeper to analyze which company is better positioned to capitalize on this emerging market trend.

The Case for Arista

AI workloads are placing substantially greater demands on data-center networks. As clusters become larger, moving data efficiently between accelerators becomes increasingly important. This ensures efficient overall system resource utilization. Owing to this, higher-speed Ethernet standards such as 800G have become a critical component in next-generation AI infrastructure. 

Moreover, growth opportunity is not limited to moving data in a single AI cluster. AI infrastructure is becoming increasingly distributed due to constraints related to power and physical capacity. This is creating strong demand for networking equipment capable of moving vast data volumes across the distributed data center network. Arista, with its comprehensive portfolio of AI networking solutions, is benefiting from this trend. The company has expanded its Etherlink AI-fabric customer base to more than 100 cumulative customers, compared with only four to five customers in 2024.

The company now offers switching platforms spanning traditional Ethernet deployments through emerging 1.6-terabit AI fabrics while expanding liquid-cooled networking solutions for next-generation data centers. Arista expands its software platform beyond cloud data centers through automation, campus networking, routing and AI networking capabilities. The company's unified EOS architecture enables programmable networking across client, campus, cloud and AI environments while supporting advanced routing, observability and operational automation.

To address the power, physical space and compute-related constraints, customers are looking to distribute AI workloads across campuses and data centers. Arista's 7800 platform is designed for these distributed environments, supporting traffic management, routing, security and load balancing across locations.

However, Arista faces strong competition from other major players in the industry such as Cisco Systems, Inc. CSCO and Hewlett Packard Enterprise HPE. Cisco historically dominated networking and is rapidly expanding into the AI networking space. Cisco currently has $9.3 billion worth of AI infrastructure-related orders. The company continues to expand AI data center offerings, including Nexus innovations to capture greater market share. 

HPE is benefiting from a robust demand environment for its edge-to-cloud platform, GreenLake, backed by growing digital transformation initiatives. With the acquisition of Juniper Networks, HPE has significantly strengthened its networking domain in AI, cloud and hybrid solutions. Rising competition can impact Arista’s growth prospects.

The Case for Celestica

Celestica is benefiting from the rapid upgrade of hyperscale data-center networks. Demand for its 800G Ethernet switches remains strong. The company’s Communications revenues grew 62% in the second quarter, primarily because of 800G switch programs. The transition to 1.6T networking is creating the next growth wave for the company. Celestica expects mass production of 1.6T programs with two hyperscalers to begin in the third quarter of 2026.

It is to be noted that a major distinction between Arista and Celestica is that Celestica's AI opportunity extends beyond networking. Celestica is seeing increasing demand for AI/ML compute infrastructure from hyperscalers. Enterprise revenues jumped 167% in the second quarter, driven primarily by the accelerated ramp of an AI/ML compute program.

Celestica’s partnership with OpenAI provides an important long-term growth opportunity. The company will manufacture advanced AI racks developed in collaboration with Broadcom to support OpenAI's custom accelerator roadmap. Advanced Micro Devices AMD is expanding its AI infrastructure portfolio with the upcoming Helios platform to strengthen its position in the hyperscale AI market. Celestica is a key manufacturing and design partner in this initiative. Celestica is providing a scale-up networking switch that serves as the backbone of AMD’s Helios rack architecture. Management stated that the OpenAI and AMD collaborations can bring multi-billion-dollar opportunities in 2027.

Celestica’s diverse portfolio offering is a major advantage. The company is witnessing solid demand across its healthtech and industrial businesses. Stronger demand for wafer fabrication equipment is a positive.

How Do Zacks Estimates Compare for CLS & ANET?

The Zacks Consensus Estimate for CLS’ full-year sales implies year-over-year growth of 64.27%, while that of EPS suggests growth of 78.51%. The EPS estimates have been trending northward over the past 60 days.

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The Zacks Consensus Estimate for ANET’s 2026 sales and EPS implies year-over-year growth of 37.66% and 35.57%, respectively. The EPS estimates have increased over the past 60 days.

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Price Performance & Valuation of CLS & ANET

Over the past year, Celestica has gained 72.6%, while ANET has gained 54.2% over the same period.

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CLS looks more attractive than Arista from a valuation standpoint. Going by the price/earnings ratio, Celestica’s shares currently trade at 22.88 forward earnings, lower than 49.98 for Arista.

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CLS or ANET: Which is a Better Pick?

Celestica and Arista sport a Zacks Rank #1 (Strong Buy) each. You can see the complete list of today’s Zacks #1 Rank stocks here.

Both Celestica and Arista are expanding their portfolio offerings and placing strong focus on innovation to gain from the expanding AI market. Arista has already placed itself as a major provider of AI networking solutions. But its growth trajectory could be hindered by other strong players in the market. Consequently, Celestica plays a larger role in the AI infrastructure space. Its exposure spans 800G and 1.6T networking, AI/ML compute, custom racks and hyperscaler infrastructure. Celestica’s focus on product diversification and increasing its presence in high-value markets is positive. Owing to these factors and a better valuation, Celestica seems to be a better investment option at present. 

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