Arrow Electronics (NYSE:ARW) - Share price, News & Analysis

ARW fundamental analysis
Snowflake Score
Valuation	5/6
Future Growth	0/6
Past Performance	6/6
Financial Health	4/6
Dividends	0/6

ARW Stock Overview

Rewards

Trading at 71.5% below our estimate of its fair value

Earnings grew by 71.3% over the past year

Risk Analysis

Earnings are forecast to decline by an average of 7.9% per year for the next 3 years

Debt is not well covered by operating cash flow

Significant insider selling over the past 3 months

Arrow Electronics Competitors

CDW

NasdaqGS:CDW

US$21.8b

TD SYNNEX

NYSE:SNX

US$9.3b

Avnet

NasdaqGS:AVT

US$4.5b

Insight Enterprises

NasdaqGS:NSIT

US$3.3b

Price History & Performance

Summary of all time highs, changes and price drops for Arrow Electronics
Historical stock prices
Current Share Price	US$116.35
52 Week High	US$137.95
52 Week Low	US$107.11
Beta	1.37
1 Month Change	1.54%
3 Month Change	-3.61%
1 Year Change	-4.60%
3 Year Change	80.14%
5 Year Change	53.92%
Change since IPO	5,905.16%

Recent News & Updates

May 21

Arrow And Avnet: 2 Key Players In The Components Supply Chain

Both Arrow Electronics and Avnet play key roles in the supply chain for electronics components and their stocks have outperformed the wider semiconductor sector since the beginning of this year. As value-added distributors, they have been faring well in a supply-constrained environment, even managing to grow gross margins. However, with the current macroeconomic uncertainty, there could be a slowdown in demand itself in addition to supply pressures. In this case, Arrow has better profitability metrics, but revenue growth during the last reported quarter is down due to an unfavorable product mix and this could persist throughout 2022. As for Avnet, it has delivered better revenue and earnings growth and is a buy also due to its ability to pay dividends.

Shareholder Returns

	ARW	US Electronic	US Market
7D	-5.2%	-0.8%	1.0%
1Y	-4.6%	-16.3%	-15.1%

Return vs Industry: ARW exceeded the US Electronic industry which returned -16.2% over the past year.

Return vs Market: ARW exceeded the US Market which returned -13.2% over the past year.

Price Volatility

Is ARW's price volatile compared to industry and market?
ARW volatility
ARW Average Weekly Movement	4.6%
Electronic Industry Average Movement	7.7%
Market Average Movement	7.8%
10% most volatile stocks in US Market	16.8%
10% least volatile stocks in US Market	2.9%

Stable Share Price: ARW is less volatile than 75% of US stocks over the past 3 months, typically moving +/- 5% a week.

Volatility Over Time: ARW's weekly volatility (5%) has been stable over the past year.

About the Company

Founded	Employees	CEO	Website
1935	20,700	Mike Long	https://www.arrow.com

Arrow Electronics, Inc. provides products, services, and solutions to industrial and commercial users of electronic components and enterprise computing solutions in the Americas, Europe, the Middle East, Africa, and the Asia Pacific. The company operates in two segments, Global Components and Global Enterprise Computing Solutions. The Global Components segment markets and distributes semiconductor products and related services; passive, electro-mechanical, and interconnect products, including capacitors, resistors, potentiometers, power supplies, relays, switches, and connectors; and computing and memory products, as well as other products and services.

Arrow Electronics Fundamentals Summary

How do Arrow Electronics's earnings and revenue compare to its market cap?
ARW fundamental statistics
Market Cap	US$7.68b
Earnings (TTM)	US$1.27b
Revenue (TTM)	US$35.17b

6.1x

P/E Ratio

0.2x

P/S Ratio

Is ARW overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
ARW income statement (TTM)
Revenue	US$35.17b
Cost of Revenue	US$30.69b
Gross Profit	US$4.48b
Other Expenses	US$3.21b
Earnings	US$1.27b

Last Reported Earnings

Apr 02, 2022

Next Earnings Date

n/a

Earnings per share (EPS)	19.18
Gross Margin	12.74%
Net Profit Margin	3.60%
Debt/Equity Ratio	57.3%

How did ARW perform over the long term?

See historical performance and comparison

Valuation

Is Arrow Electronics undervalued compared to its fair value and its price relative to the market?

Valuation Score

5/6

Valuation Score 5/6

Below Fair Value
Significantly Below Fair Value
PE vs Industry
PE vs Market
PEG Ratio
PB vs Industry

>50%

Undervalued compared to fair value

Share Price vs. Fair Value

Below Fair Value: ARW ($116.35) is trading below our estimate of fair value ($407.72)

Significantly Below Fair Value: ARW is trading below fair value by more than 20%.

Price To Earnings Ratio

PE vs Industry: ARW is good value based on its Price-To-Earnings Ratio (6.1x) compared to the US Electronic industry average (16.1x).

PE vs Market: ARW is good value based on its Price-To-Earnings Ratio (6.1x) compared to the US market (14.9x).

Price to Earnings Growth Ratio

PEG Ratio: ARW's earnings are forecast to decline next year, so we can't calculate its PEG ratio.

Price to Book Ratio

PB vs Industry: ARW is good value based on its Price-To-Book Ratio (1.4x) compared to the US Electronic industry average (1.8x).

Future Growth

How is Arrow Electronics forecast to perform in the next 1 to 3 years based on estimates from 9 analysts?

Future Growth Score

0/6

Future Growth Score 0/6

Earnings vs Savings Rate
Earnings vs Market
High Growth Earnings
Revenue vs Market
High Growth Revenue
Future ROE

-7.9%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: ARW's earnings are forecast to decline over the next 3 years (-7.9% per year).

Earnings vs Market: ARW's earnings are forecast to decline over the next 3 years (-7.9% per year).

High Growth Earnings: ARW's earnings are forecast to decline over the next 3 years.

Revenue vs Market: ARW's revenue (1.5% per year) is forecast to grow slower than the US market (7.7% per year).

High Growth Revenue: ARW's revenue (1.5% per year) is forecast to grow slower than 20% per year.

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: ARW's Return on Equity is forecast to be low in 3 years time (18.3%).

Past Performance

How has Arrow Electronics performed over the past 5 years?

Past Performance Score

6/6

Past Performance Score 6/6

Quality Earnings
Growing Profit Margin
Earnings Trend
Accelerating Growth
Earnings vs Industry
High ROE

17.1%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: ARW has high quality earnings.

Growing Profit Margin: ARW's current net profit margins (3.6%) are higher than last year (2.4%).

Past Earnings Growth Analysis

Earnings Trend: ARW's earnings have grown by 17.1% per year over the past 5 years.

Accelerating Growth: ARW's earnings growth over the past year (71.3%) exceeds its 5-year average (17.1% per year).

Earnings vs Industry: ARW earnings growth over the past year (71.3%) exceeded the Electronic industry 34.4%.

Return on Equity

High ROE: ARW's Return on Equity (23.4%) is considered high.

Financial Health

How is Arrow Electronics's financial position?

Financial Health Score

4/6

Financial Health Score 4/6

Short Term Liabilities
Long Term Liabilities
Debt Level
Reducing Debt
Debt Coverage
Interest Coverage

Financial Position Analysis

Short Term Liabilities: ARW's short term assets ($15.9B) exceed its short term liabilities ($10.7B).

Long Term Liabilities: ARW's short term assets ($15.9B) exceed its long term liabilities ($3.4B).

Debt to Equity History and Analysis

Debt Level: ARW's net debt to equity ratio (52.8%) is considered high.

Reducing Debt: ARW's debt to equity ratio has reduced from 64.3% to 57.3% over the past 5 years.

Debt Coverage: ARW's debt is not well covered by operating cash flow (7.2%).

Interest Coverage: ARW's interest payments on its debt are well covered by EBIT (15.6x coverage).

Balance Sheet

Dividend

What is Arrow Electronics's current dividend yield, its reliability and sustainability?

Dividend Score

0/6

Dividend Score 0/6

Notable Dividend
High Dividend
Stable Dividend
Growing Dividend
Earnings Coverage
Future Dividend Coverage

Dividend Yield vs Market

Notable Dividend: Unable to evaluate ARW's dividend yield against the bottom 25% of dividend payers, as the company has not reported any recent payouts.

High Dividend: Unable to evaluate ARW's dividend yield against the top 25% of dividend payers, as the company has not reported any recent payouts.

Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if ARW's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if ARW's dividend payments have been increasing.

Earnings Payout to Shareholders

Earnings Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.

Cash Payout to Shareholders

Cash Flow Coverage: Unable to calculate sustainability of dividends as ARW has not reported any payouts.

Discover strong dividend paying companies

Management

How experienced are the management team and are they aligned to shareholders interests?

4.4yrs

Average management tenure

CEO

Mike Long (62 yo)

14.25yrs

Tenure

US$12,755,479

Compensation

Mr. Michael J. Long, also known as Mike, has been the Chief Executive Officer of Arrow Electronics, Inc. since May 1, 2009 and has been its President since February 3, 2008. Mr. Long serves as the Chief Ex...

CEO Compensation Analysis

Compensation vs Market: Mike's total compensation ($USD12.76M) is above average for companies of similar size in the US market ($USD8.23M).

Compensation vs Earnings: Mike's compensation has been consistent with company performance over the past year.

Leadership Team

Experienced Management: ARW's management team is considered experienced (4.4 years average tenure).

Board Members

Experienced Board: ARW's board of directors are considered experienced (4.4 years average tenure).

Ownership

Who are the major shareholders and have insiders been buying or selling?

Insider Trading Volume

Insider Buying: ARW insiders have only sold shares in the past 3 months.

Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.

Data	Last Updated (UTC time)
Company Analysis	2022/05/25 00:00
End of Day Share Price	2022/05/25 00:00
Earnings	2022/04/02
Annual Earnings	2021/12/31