Analyst Estimates: Here's What Brokers Think Of Arrow Electronics, Inc. (NYSE:ARW) After Its Annual Report
Arrow Electronics, Inc. (NYSE:ARW) came out with its full-year results last week, and we wanted to see how the business is performing and what industry forecasters think of the company following this report. Arrow Electronics reported in line with analyst predictions, delivering revenues of US$33b and statutory earnings per share of US$15.84, suggesting the business is executing well and in line with its plan. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.
See our latest analysis for Arrow Electronics
Taking into account the latest results, the eight analysts covering Arrow Electronics provided consensus estimates of US$29.9b revenue in 2024, which would reflect a chunky 9.5% decline over the past 12 months. Statutory earnings per share are forecast to plummet 36% to US$10.82 in the same period. Before this earnings report, the analysts had been forecasting revenues of US$30.7b and earnings per share (EPS) of US$13.32 in 2024. The analysts seem less optimistic after the recent results, reducing their revenue forecasts and making a substantial drop in earnings per share numbers.
The analysts made no major changes to their price target of US$124, suggesting the downgrades are not expected to have a long-term impact on Arrow Electronics' valuation. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. The most optimistic Arrow Electronics analyst has a price target of US$148 per share, while the most pessimistic values it at US$100.00. These price targets show that analysts do have some differing views on the business, but the estimates do not vary enough to suggest to us that some are betting on wild success or utter failure.
One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. We would highlight that revenue is expected to reverse, with a forecast 9.5% annualised decline to the end of 2024. That is a notable change from historical growth of 5.5% over the last five years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 5.4% per year. It's pretty clear that Arrow Electronics' revenues are expected to perform substantially worse than the wider industry.
The Bottom Line
The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Arrow Electronics. Unfortunately, they also downgraded their revenue estimates, and our data indicates underperformance compared to the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.
Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. At Simply Wall St, we have a full range of analyst estimates for Arrow Electronics going out to 2026, and you can see them free on our platform here..
You should always think about risks though. Case in point, we've spotted 2 warning signs for Arrow Electronics you should be aware of.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
