Arrow Electronics (ARW) AI Stock Analysis

• Market Cap: $6.21B
• Dividend Yield: N/A
• Average Volume (3M): 507.32K
• Price to Earnings (P/E): 13.7
• Beta (1Y): 1.01
• Revenue Growth: -3.95%
• EPS Growth: -16.72%
• Country: US
• Employees: 21,520
• Sector: Technology
• Sector Strength: 88
• Industry: Technology Distributors
• EPS (TTM): 2.43
• Shares Outstanding: 51,501,705
• 10 Day Avg. Volume: 671,971
• 30 Day Avg. Volume: 507,323
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 1.50
• Enterprise Value/Revenue: 0.33
• Enterprise Value/Gross Profit: 2.94
• Enterprise Value/Ebitda: 10.56
• 1Y Price Target: $129.50
• Price Target Upside: 7.02% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 2

• Rating: 69 Neutral
• Price Target: $130.00 ▲(7.44% Upside)

Arrow Electronics' overall stock score is driven by a positive earnings call that highlighted strong sales growth and market recovery, despite challenges in gross margins and external pressures. Financial performance shows stability but is pressured by declining margins and cash flow. Technical analysis indicates a bearish trend, while valuation is reasonable, though lacking a dividend yield.

Positive Factors

Revenue Growth

Strong revenue growth indicates robust demand for Arrow's products and services, suggesting effective market strategies and a solid competitive position.

Market Position

Expanding product portfolio with strategic partnerships enhances Arrow's market position, offering a broader range of solutions to meet customer needs.

Improved Operational Efficiency

Improved cash conversion and inventory management reflect enhanced operational efficiency, supporting better cash flow and resource utilization.

Negative Factors

Leadership Transition

Leadership changes can create uncertainty in strategic direction and execution, potentially impacting long-term business stability and growth.

Declining Margins

Declining margins suggest pressure on profitability, which could affect Arrow's ability to invest in growth and maintain competitive pricing.

Decreasing Free Cash Flow

A significant decline in free cash flow limits Arrow's financial flexibility, potentially constraining future investments and operational resilience.

Arrow Electronics Business Overview & Revenue Model

Company Description

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. The Global Enterprise Computing Solutions segment offers computing solutions, such as datacenter, cloud, security, and analytics solutions. This segment provides access to various services, including engineering and integration support, warehousing and logistics, marketing resources, and authorized hardware and software training. The company serves original equipment manufacturers, value-added resellers, managed service providers, contract manufacturers, and other commercial customers. Arrow Electronics, Inc. was founded in 1935 and is based in Centennial, Colorado.

How the Company Makes Money

Arrow Electronics generates revenue through multiple key channels. The primary source of income is the distribution of electronic components, where the company earns margins on the products it purchases from manufacturers and sells to customers. Additionally, Arrow provides value-added services such as logistics, supply chain management, and technical support, which further enhance its revenue. The Global Enterprise Computing Solutions segment contributes to earnings by offering IT solutions and services, including cloud computing and data center solutions, often through partnerships with leading technology providers. Significant partnerships with major manufacturers like Intel, Texas Instruments, and HP also bolster Arrow's product offerings, ensuring a steady stream of income from both product sales and service contracts.

Arrow Electronics Financial Statement Overview

Summary

Arrow Electronics demonstrates a stable yet pressured financial position with reasonable profitability and manageable leverage. However, the declining profitability margins and free cash flow, along with moderate revenue growth, highlight challenges in sustaining growth and operational efficiency in a competitive technology distribution industry.

Income Statement

Arrow Electronics has shown a mixed performance in the TTM with a gross profit margin of 11.1% and a net profit margin of 1.6%. The revenue growth rate from the previous year is 2.1%, indicating slow growth. The EBIT margin stands at 2.5%, and the EBITDA margin is 2.7%, reflecting moderate operational efficiency. However, the decline in margins over the years suggests pressure on profitability.

Balance Sheet

The debt-to-equity ratio is 0.45, reflecting a manageable level of leverage. ROE is calculated at 7.4%, which is reasonable but not exceptional. The equity ratio is 26.1%, indicating a moderate level of financial stability. However, decreasing equity over the years and increasing liabilities pose potential risks.

Cash Flow

Free cash flow has grown by -50.7% compared to the last annual report, indicating a considerable decline. The operating cash flow to net income ratio is 1.18, suggesting that operating cash flows are sufficient to cover net income. However, a decrease in free cash flow poses a concern for future cash availability.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	28.50B	27.92B	33.11B	37.12B	34.48B	28.67B
Gross Profit	3.17B	3.29B	4.15B	4.84B	4.20B	3.19B
EBITDA	883.79M	984.44M	1.67B	2.26B	1.78B	1.10B
Net Income	467.24M	392.07M	903.50M	1.43B	1.11B	584.44M
Balance Sheet
Total Assets	24.25B	21.76B	21.73B	21.76B	19.54B	17.05B
Cash, Cash Equivalents and Short-Term Investments	221.97M	188.81M	218.05M	176.91M	222.19M	373.62M
Total Debt	2.82B	3.12B	3.81B	3.77B	2.63B	2.26B
Total Liabilities	17.84B	15.93B	15.85B	16.15B	14.19B	11.90B
Stockholders Equity	6.33B	5.76B	5.81B	5.55B	5.28B	5.09B
Cash Flow
Free Cash Flow	468.14M	1.04B	622.16M	-111.91M	335.93M	1.24B
Operating Cash Flow	552.80M	1.13B	705.45M	-33.08M	418.98M	1.36B
Investing Cash Flow	32.00M	-94.44M	-72.32M	-57.71M	-60.12M	-138.79M
Financing Cash Flow	-737.87M	-956.83M	-666.22M	109.78M	-463.30M	-1.23B

Arrow Electronics Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 121.00
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ARW, the sentiment is Neutral. The current price of 121 is below the 20-day moving average (MA) of 123.95, below the 50-day MA of 124.24, and above the 200-day MA of 117.11, indicating a neutral trend. The MACD of -1.42 indicates Positive momentum. The RSI at 43.79 is Neutral, neither overbought nor oversold. The STOCH value of 38.76 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for ARW.

Arrow Electronics Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
SNX	76 Outperform	$13.69B	18.02	13.11%	1.05%	6.94%	19.51%
CNXN	74 Outperform	$1.56B	18.73	9.56%	0.89%	4.94%	-1.79%
SCSC	71 Outperform	$967.08M	14.61	7.89%	―	-6.72%	-1.14%
ARW	69 Neutral	$6.21B	13.68	7.74%	―	-3.95%	-16.72%
AVT	66 Neutral	$4.32B	18.82	4.79%	2.56%	-6.55%	-49.61%
NSIT	61 Neutral	$3.54B	27.06	9.32%	―	-7.61%	-50.01%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%

Arrow Electronics Corporate Events

Arrow Electronics Extends Credit Facility to $2 Billion

On June 27, 2025, Arrow Electronics, Inc. and its subsidiaries entered into a Fifth Amended and Restated Credit Agreement with JPMorgan Chase Bank, N.A., extending their existing credit facility to $2 billion. This agreement extends the maturity date to June 27, 2030, introduces a step-up provision for leverage ratios during material acquisitions, and modifies various covenants and financial definitions, impacting the company’s operational flexibility and financial strategies.