Analysts have raised their Arrow Electronics fair value estimate from $94.00 to $115.00, citing updated assumptions on revenue growth, profit margin, discount rate, and a lower future P/E multiple as the key drivers of this change.
What's in the News
- Elevate Quantum, Arrow Electronics, and several quantum technology partners launched the Quantum Platform for the Advancement of Commercialization (Q PAC), described as the first commercially deployable Quantum Open Architecture system in the US and built using the open, modular Quantum Utility Block framework (Key Developments).
- Q PAC is live at Elevate Quantum’s Commercialization Lab in Denver with a 17 qubit processor, modular control electronics, cryogenic infrastructure, and software for calibration and error suppression. It is structured as an open reference architecture for enterprise, research, and government users (Key Developments).
- Through collaboration with Arrow Electronics, the QUB framework is planned to include a GPU cluster reference server connected to quantum hardware via NVIDIA NVQLink to support low latency compute and hybrid quantum classical workflows for high performance computing environments (Key Developments).
- Citrix expanded its agreement with Arrow Electronics to include all Citrix Service Provider business in North America and Europe from March 1, 2026. Arrow will manage partner transactions, pricing, incentives, and engagement, while Citrix focuses on product strategy and technical support (Key Developments).
- Arrow Electronics reported that from September 28, 2025 to December 31, 2025 it repurchased 448,883 shares for US$50 million, completing repurchases of 22,337,721 shares for US$2,617.04 million under the buyback program announced on August 5, 2021 (Key Developments).
Valuation Changes
- Fair Value: Raised from $94.00 to $115.00, a move of about 22% that reflects updated model assumptions.
- Discount Rate: Reduced slightly from 9.86% to 9.55%, which increases the present value of projected cash flows.
- Revenue Growth: Assumption increased from 5.26% to 7.08%, indicating a higher expected top line trajectory in the model.
- Net Profit Margin: Assumption lifted from 1.18% to 1.56%, pointing to a higher expected level of profitability on future sales.
- Future P/E: Trimmed from 15.07x to 12.26x, implying a more conservative exit multiple applied to future earnings.
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