Avnet (VNI) AI Stock Analysis

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Avnet

(XETRA:VNI)

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Positive Factors

Broad-Based Demand GrowthBroad demand across geographies, technologies and end markets indicates growth is not dependent on a single customer group or temporary replenishment cycle. Healthy book-to-bills and growing backlog support continued revenue visibility and strengthen Avnet’s role in the electronics supply chain.

Negative Factors

Negative Cash ConversionMaterially negative operating and free cash flow despite reported earnings shows that profits are not currently converting into liquidity. Persistent working-capital demands can reduce financial flexibility, increase funding needs, and make growth more dependent on external capital.

Avnet (VNI) vs. iShares MSCI Germany ETF (EWG)

Market Cap: EUR 7.04B
Dividend Yield: 1.53%
Average Volume (3M): 57
Price to Earnings (P/E): 12.5
Beta (1Y): 0.26
Revenue Growth: 37.33%
EPS Growth: 136.62%
Country: Germany
Employees: 15,040
Sector: Technology
Sector Strength: 61
Industry: Technology Distributors

Avnet Business Overview & Revenue Model

Company Description

Avnet, Inc., established in Phoenix, Arizona, in 1921, operates as a global technology distributor and solutions provider. The company specializes in marketing, selling, and distributing electronic components, with its business activities structured...

Avnet Earnings Call Summary

Earnings Call Date:Nov 04, 2026(Q1-2027)|% Change Since:-0.63%|Next Earnings Date:Feb 03, 2027

Earnings Call SentimentPositive

The call was strongly positive: Avnet reported record sales and EPS, broad-based growth across regions and businesses, expanding operating margins, improved returns on working capital and optimistic second-quarter guidance. The main challenges were gross-margin pressure, higher interest expense, substantial working-capital and capital-raising needs, tightening supply conditions and seasonal uncertainty in Asia, but management said current supply constraints were not inhibiting growth or guidance.

Positive Updates

Record Revenue and Earnings

Avnet reported record first-quarter sales of $10.7 billion, up 82% year-over-year and 29% sequentially, exceeding the high end of guidance. Adjusted diluted EPS reached a quarterly record of $3.63 and was well above the high end of guidance. Excluding the impact of the extra week, sales grew 71% year-over-year and 21% sequentially.

Negative Updates

Gross Margin Compression

Company gross profit margin was 10%, down approximately 40 basis points both year-over-year and sequentially, primarily due to product and customer mix. Electronic Components gross margin declined approximately 30 basis points year-over-year and sequentially, partly because Avnet Integrated Solutions has a lower gross margin than the EC average.

Company Guidance

For the second quarter, Avnet is guiding sales in the range of $11.1 billion to $11.4 billion and adjusted diluted earnings per share in the range of $3.90 to $4.10, assuming current market conditions and electronic component availability, including in the memory product category persists, similar interest expense compared to the first quarter, an effective tax rate of between 21% and 25% and 87 million shares outstanding on a diluted basis; the guidance implies a sequential sales increase of 5% at the midpoint, or 12% sequentially at the midpoint on a comparable basis adjusted for the extra week in Q1. Avnet expects to drive its operating expense to gross profit dollar ratio to low 50s through the remainder of fiscal 2027, EC operating margin to reach 5% in the second half of fiscal 2027, Farnell operating margin to expand beyond 10%, positive cash flow by the end of fiscal 2027 and 3x leverage by the second half of fiscal 2027, while inventory days are expected to remain flattish to down slightly, and the second-quarter guide implies very modest improvements in pricing, kind of flattish pricing.

Avnet Risk Analysis

Avnet disclosed 20 risk factors in its most recent earnings report. Avnet reported the most risks in the "Legal & Regulatory" category.

Legal & Regulatory - Litigation, compliance, new legislation, and taxation risks

Latest Risks Added

1 New Risk

1.10The impact of these trade disruptionsQ2, 2026

Avnet Peers Comparison

Overall Rating

UnderperformOutperform

Sector (61)

Financial Indicators

DE:VNI against its peers
Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CLMB	78Outperform	$801.55M	33.06	19.25%	0.10%	24.23%	10.53%
SNX	76Outperform	$19.22B	14.66	14.94%	0.79%	24.10%	77.90%
ARW	69Neutral	$10.01B	9.95	14.84%	―	32.46%	118.04%
CNXN	69Neutral	$2.11B	20.45	10.89%	0.96%	9.53%	24.84%
SCSC	64Neutral	$908.33M	13.72	7.43%	―	14.77%	-0.71%
Sector *	61Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%

* Technology Sector Average

Performance Comparison

DE:VNI and its peers over the selected period
Ticker	Company Name	Price	Change	% Change
DE:VNI	Avnet	79.50	40.33	102.98%
ARW	Arrow Electronics, Inc.	198.20	90.04	83.25%
CNXN	Pc Connection	83.16	24.82	42.55%
SCSC	ScanSource Inc	44.26	3.55	8.72%
SNX	TD SYNNEX Corporation	242.51	93.24	62.46%
CLMB	Climb Global Solutions, Inc.	43.09	15.77	57.69%

Glossary

BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.

Avnet AI Stock Analysis