Arrow Electronics, Inc. (ARW) stock analysis

P/E above its 5-year median

Arrow Electronics's P/E of 9.8 is above its own 5-year median of 9.7.

P/E below the industry

Arrow Electronics's P/E of 9.8 is below the Wholesale Trade-durable Goods median of 19.9.

EV/EBITDA above its 5-year median

Arrow Electronics's EV/EBITDA of 7.7 is above its 5-year median of 7.4.

P/B below the industry

Arrow Electronics's price-to-book of 1.37 is below the Wholesale Trade-durable Goods median of 2.13.

Trading below fair value

The share price of $192.90 is below our fair value estimate of $250.97.

Margin of safety over 20%

The price is 23.1% below fair value, more than the 20% cushion we look for.

Revenue growing under 10% a year

Revenue grew -6.0% a year over the last three fiscal years, short of the 10% we look for.

EPS growing under 10% a year

Diluted EPS grew -20.6% a year over the last three fiscal years.

Earnings growth accelerating

Net income grew 115% over the last twelve months, against a 5-year average of -0.5% a year.

Growing faster than the industry

Revenue grew 32.5% over the last twelve months; the Wholesale Trade-durable Goods median is 13.5%.

Guidance lowered

Arrow Electronics lowered its First-Quarter 2026 global enterprise computing solutions sales outlook on Feb 5, 2026.

Gross margin improving

Gross margin was 11.3% over the last twelve months, against 11.1% a year earlier.

Return on equity over 15%

Return on equity was 15.0% over the last twelve months and averaged 15.9% over five years.

Return on capital over 10%

Return on invested capital was 12.0%, above the 10% that usually covers the cost of capital.

Return on equity above the industry

Arrow Electronics's return on equity of 15.0% is above the Wholesale Trade-durable Goods median of 11.1%.

Earnings shrank over 5 years

Net income shrank 0.5% a year on average over the last five fiscal years.

Net margin above its 5-year average

Net margin was 2.6% over the last twelve months, against a 5-year average of 2.6%.

Net margin below the industry

Arrow Electronics's net margin of 2.6% is below the Wholesale Trade-durable Goods median of 2.7%.

Low debt

Debt is 38.3% of shareholders' equity, under the 40% we consider low.

Debt falling against equity

Debt to equity fell from 44.3% five years ago to 38.3%.

Debt covered by cash flow

Operating cash flow over the last twelve months equals 28.2% of total debt.

Interest coverage

Interest expense is not reported separately.

Short-term assets cover short-term debts

Current assets are 1.20 times current liabilities.

Elevated bankruptcy risk

The Altman Z-score is 1.54; above 3 is the safe zone and below 1.8 the distress zone.

No dividend

Arrow Electronics has not paid a dividend in the last twelve months.

Yield against Treasuries

No dividend.

Yield against the market

No dividend.

Dividend stability

No dividend.

Earnings cover

No dividend.

Cash-flow cover

No dividend.