ARROW ELECTRONICS INC (ARW) Stock Fundamental Analysis
NYSE:ARW - US0427351004 - Common Stock
126.82 USD
-0.96 (-0.75%)
126.82 USD
0 (0%)
We assign a fundamental rating of 4 out of 10 to ARW. ARW was compared to 124 industry peers in the Electronic Equipment, Instruments & Components industry. Both the profitability and the financial health of ARW get a neutral evaluation. Nothing too spectacular is happening here. ARW is valued quite cheap, while showing a decent growth score. This is a good combination!
1. Profitability
1.1 Basic Checks
In the past year ARW was profitable.
ARW had a positive operating cash flow in the past year.
Each year in the past 5 years ARW has been profitable.
Of the past 5 years ARW 4 years had a positive operating cash flow.
1.2 Ratios
The Return On Assets of ARW (1.93%) is comparable to the rest of the industry.
ARW has a better Return On Equity (7.38%) than 66.13% of its industry peers.
ARW has a better Return On Invested Capital (6.63%) than 70.16% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for ARW is above the industry average of 9.70%.
The 3 year average ROIC (12.62%) for ARW is well above the current ROIC(6.63%). The reason for the recent decline needs to be investigated.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.93% | ||
| ROE | 7.38% | ||
| ROIC | 6.63% |
ROA(3y)4.17%
ROA(5y)4.32%
ROE(3y)16.03%
ROE(5y)16.11%
ROIC(3y)12.62%
ROIC(5y)12.42%
1.3 Margins
With a Profit Margin value of 1.64%, ARW perfoms like the industry average, outperforming 57.26% of the companies in the same industry.
In the last couple of years the Profit Margin of ARW has declined.
ARW has a Operating Margin (2.86%) which is in line with its industry peers.
In the last couple of years the Operating Margin of ARW has remained more or less at the same level.
ARW's Gross Margin of 11.27% is on the low side compared to the rest of the industry. ARW is outperformed by 77.42% of its industry peers.
In the last couple of years the Gross Margin of ARW has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 2.86% | ||
| PM (TTM) | 1.64% | ||
| GM | 11.27% |
OM growth 3Y-10.54%
OM growth 5Y0.58%
PM growth 3Y-24.12%
PM growth 5YN/A
GM growth 3Y-1.1%
GM growth 5Y0.67%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so ARW is still creating some value.
ARW has less shares outstanding than it did 1 year ago.
The number of shares outstanding for ARW has been reduced compared to 5 years ago.
ARW has a better debt/assets ratio than last year.
2.2 Solvency
An Altman-Z score of 2.16 indicates that ARW is not a great score, but indicates only limited risk for bankruptcy at the moment.
ARW has a worse Altman-Z score (2.16) than 66.94% of its industry peers.
ARW has a debt to FCF ratio of 6.03. This is a slightly negative value and a sign of low solvency as ARW would need 6.03 years to pay back of all of its debts.
The Debt to FCF ratio of ARW (6.03) is comparable to the rest of the industry.
ARW has a Debt/Equity ratio of 0.45. This is a healthy value indicating a solid balance between debt and equity.
The Debt to Equity ratio of ARW (0.45) is worse than 64.52% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.45 | ||
| Debt/FCF | 6.03 | ||
| Altman-Z | 2.16 |
ROIC/WACC0.72
WACC9.23%
2.3 Liquidity
A Current Ratio of 1.39 indicates that ARW should not have too much problems paying its short term obligations.
ARW has a worse Current ratio (1.39) than 79.03% of its industry peers.
ARW has a Quick Ratio of 1.07. This is a normal value and indicates that ARW is financially healthy and should not expect problems in meeting its short term obligations.
Looking at the Quick ratio, with a value of 1.07, ARW is doing worse than 73.39% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.39 | ||
| Quick Ratio | 1.07 |
3. Growth
3.1 Past
The earnings per share for ARW have decreased strongly by -26.42% in the last year.
The Earnings Per Share has been growing slightly by 6.45% on average over the past years.
ARW shows a decrease in Revenue. In the last year, the revenue decreased by -3.95%.
The Revenue has been decreasing by -0.70% on average over the past years.
EPS 1Y (TTM)-26.42%
EPS 3Y-13.05%
EPS 5Y6.45%
EPS Q2Q%-2.41%
Revenue 1Y (TTM)-3.95%
Revenue growth 3Y-6.79%
Revenue growth 5Y-0.7%
Sales Q2Q%9.97%
3.2 Future
The Earnings Per Share is expected to grow by 23.81% on average over the next years. This is a very strong growth
The Revenue is expected to grow by 6.98% on average over the next years.
EPS Next Y1.24%
EPS Next 2Y19.06%
EPS Next 3Y23.81%
EPS Next 5YN/A
Revenue Next Year9.78%
Revenue Next 2Y7.86%
Revenue Next 3Y6.98%
Revenue Next 5YN/A
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 13.24, which indicates a correct valuation of ARW.
94.35% of the companies in the same industry are more expensive than ARW, based on the Price/Earnings ratio.
The average S&P500 Price/Earnings ratio is at 27.17. ARW is valued rather cheaply when compared to this.
With a Price/Forward Earnings ratio of 8.73, the valuation of ARW can be described as very reasonable.
Based on the Price/Forward Earnings ratio, ARW is valued cheaper than 96.77% of the companies in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 22.78. ARW is valued rather cheaply when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.24 | ||
| Fwd PE | 8.73 |
4.2 Price Multiples
91.94% of the companies in the same industry are more expensive than ARW, based on the Enterprise Value to EBITDA ratio.
94.35% of the companies in the same industry are more expensive than ARW, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 13.95 | ||
| EV/EBITDA | 9.04 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates ARW does not grow enough to justify the current Price/Earnings ratio.
A more expensive valuation may be justified as ARW's earnings are expected to grow with 23.81% in the coming years.
PEG (NY)10.69
PEG (5Y)2.05
EPS Next 2Y19.06%
EPS Next 3Y23.81%
5. Dividend
5.1 Amount
No dividends for ARW!.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
126.82
-0.96 (-0.75%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupTechnology Hardware & Equipment
GICS IndustryElectronic Equipment, Instruments & Components
Earnings (Last)
Earnings (Next)
Inst Owners107.81%
Inst Owner Change2.1%
Ins Owners0.61%
Ins Owner Change0%
Market Cap6.53B
Analysts50
Price Target120.08 (-5.31%)
Short Float %4.49%
Short Ratio4.89
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Yearly DividendN/A
Dividend Growth(5Y)N/A
DPN/A
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)20.14%
Min EPS beat(2)16%
Max EPS beat(2)24.28%
EPS beat(4)4
Avg EPS beat(4)14.6%
Min EPS beat(4)6.15%
Max EPS beat(4)24.28%
EPS beat(8)8
Avg EPS beat(8)12.01%
EPS beat(12)10
Avg EPS beat(12)8.03%
EPS beat(16)14
Avg EPS beat(16)9.27%
Revenue beat(2)2
Avg Revenue beat(2)5.77%
Min Revenue beat(2)4.8%
Max Revenue beat(2)6.75%
Revenue beat(4)4
Avg Revenue beat(4)3.52%
Min Revenue beat(4)0.39%
Max Revenue beat(4)6.75%
Revenue beat(8)5
Avg Revenue beat(8)1.64%
Revenue beat(12)6
Avg Revenue beat(12)0.68%
Revenue beat(16)8
Avg Revenue beat(16)0.58%
PT rev (1m)1.03%
PT rev (3m)-0.45%
EPS NQ rev (1m)-8.65%
EPS NQ rev (3m)-11.72%
EPS NY rev (1m)0%
EPS NY rev (3m)-0.66%
Revenue NQ rev (1m)4.95%
Revenue NQ rev (3m)10.64%
Revenue NY rev (1m)3.93%
Revenue NY rev (3m)6.12%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.24 | ||
| Fwd PE | 8.73 | ||
| P/S | 0.23 | ||
| P/FCF | 13.95 | ||
| P/OCF | 11.81 | ||
| P/B | 1.03 | ||
| P/tB | 1.58 | ||
| EV/EBITDA | 9.04 |
EPS(TTM)9.58
EY7.55%
EPS(NY)14.53
Fwd EY11.46%
FCF(TTM)9.09
FCFY7.17%
OCF(TTM)10.73
OCFY8.46%
SpS553.4
BVpS122.99
TBVpS80.06
PEG (NY)10.69
PEG (5Y)2.05
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.93% | ||
| ROE | 7.38% | ||
| ROCE | 8.78% | ||
| ROIC | 6.63% | ||
| ROICexc | 6.79% | ||
| ROICexgc | 8.84% | ||
| OM | 2.86% | ||
| PM (TTM) | 1.64% | ||
| GM | 11.27% | ||
| FCFM | 1.64% |
ROA(3y)4.17%
ROA(5y)4.32%
ROE(3y)16.03%
ROE(5y)16.11%
ROIC(3y)12.62%
ROIC(5y)12.42%
ROICexc(3y)12.88%
ROICexc(5y)12.75%
ROICexgc(3y)16.8%
ROICexgc(5y)17.19%
ROCE(3y)16.81%
ROCE(5y)16.22%
ROICexcg growth 3Y-21.09%
ROICexcg growth 5Y-3.76%
ROICexc growth 3Y-19.55%
ROICexc growth 5Y-2.39%
OM growth 3Y-10.54%
OM growth 5Y0.58%
PM growth 3Y-24.12%
PM growth 5YN/A
GM growth 3Y-1.1%
GM growth 5Y0.67%
F-Score5
Asset Turnover1.18
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.45 | ||
| Debt/FCF | 6.03 | ||
| Debt/EBITDA | 2.92 | ||
| Cap/Depr | 55.99% | ||
| Cap/Sales | 0.3% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 57.26% | ||
| Profit Quality | 100.19% | ||
| Current Ratio | 1.39 | ||
| Quick Ratio | 1.07 | ||
| Altman-Z | 2.16 |
F-Score5
WACC9.23%
ROIC/WACC0.72
Cap/Depr(3y)48.3%
Cap/Depr(5y)50.65%
Cap/Sales(3y)0.27%
Cap/Sales(5y)0.29%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-26.42%
EPS 3Y-13.05%
EPS 5Y6.45%
EPS Q2Q%-2.41%
EPS Next Y1.24%
EPS Next 2Y19.06%
EPS Next 3Y23.81%
EPS Next 5YN/A
Revenue 1Y (TTM)-3.95%
Revenue growth 3Y-6.79%
Revenue growth 5Y-0.7%
Sales Q2Q%9.97%
Revenue Next Year9.78%
Revenue Next 2Y7.86%
Revenue Next 3Y6.98%
Revenue Next 5YN/A
EBIT growth 1Y-32.9%
EBIT growth 3Y-16.61%
EBIT growth 5Y-0.12%
EBIT Next Year11.49%
EBIT Next 3Y17.76%
EBIT Next 5YN/A
FCF growth 1Y75.33%
FCF growth 3Y45.64%
FCF growth 5Y7.97%
OCF growth 1Y59.45%
OCF growth 3Y39.21%
OCF growth 5Y5.67%