Did Avnet's (AVT) Aggressive Share Buyback Program Just Shift Its Investment Narrative?

• Avnet recently reported its first-quarter results, posting US$5,898.57 million in sales and US$51.75 million in net income, alongside updated guidance for the second quarter and details on share repurchases completed since June 2025.
• A key highlight is that Avnet has now repurchased over 20% of its shares since launching its buyback program in June 2022, impacting its capital structure and future earnings per share.
• We'll examine how the recently completed share buybacks could affect Avnet's investment case and its earnings power moving forward.

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Avnet Investment Narrative Recap

To own Avnet stock, you need confidence in the company's ability to grow sales and earnings despite margin pressures and cyclical end-market demand. Avnet’s latest results show resilient revenue but ongoing margin compression, while management’s focus on buybacks and guidance for higher EPS may support the stock in the short term; however, persistent weakness in EMEA and unpredictable regional demand remain the most important risks, while a sustained inventory recovery is key for renewed momentum. The impact of recent share buybacks, though substantial in scope, is not material enough to offset these operational risks in the near term.

Among recent updates, Avnet’s announced Q2 guidance stands out, with management expecting sales between US$5.85 billion and US$6.15 billion, and GAAP diluted EPS of US$0.74 to US$0.92. This guidance underscores the company's emphasis on stabilizing earnings and points to management’s expectations for continued operational discipline, which could be pivotal if global demand continues to recover and margin pressures ease.

In contrast, investors should also be aware that persistent margin compression from faster-growing but lower-margin Asian operations could…

Read the full narrative on Avnet (it's free!)

Avnet's narrative projects $25.5 billion revenue and $680.5 million earnings by 2028. This requires 4.8% yearly revenue growth and an earnings increase of $440.3 million from $240.2 million.

Uncover how Avnet's forecasts yield a $53.00 fair value, a 12% upside to its current price.

Exploring Other Perspectives

Simply Wall St Community members provided four fair value estimates for Avnet, ranging from US$9.92 to US$64 per share. While these investor views cover a wide spectrum, margin compression from regional mix shifts remains a prominent concern that could shape the company’s earnings profile over time.

Explore 4 other fair value estimates on Avnet - why the stock might be worth less than half the current price!

Build Your Own Avnet Narrative

Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

• A great starting point for your Avnet research is our analysis highlighting 4 key rewards and 3 important warning signs that could impact your investment decision.
• Our free Avnet research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Avnet's overall financial health at a glance.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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