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Arrow (ARW) to Report Q4 Earnings: What's in the Offing?

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·4 min read
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Arrow Electronics ARW is slated to report fourth-quarter 2021 results on Feb 3.

The company’s earnings beat the Zacks Consensus Estimate in all the trailing four quarters, the average surprise being 18.6%.

For the fourth quarter, Arrow projects revenues in the range of $8.55-$9.15 billion. The Zacks Consensus Estimate for revenues is pegged at $8.85 billion, suggesting a 4.7% increase from the year-ago quarter’s reported figure.

Additionally, ARW forecasts adjusted earnings per share in the range of $4.37-$4.53. The consensus mark for earnings stands at $4.42 per share, calling for a 39.4% year-over-year increase.

Let’s see how things have shaped up before this announcement.

Arrow Electronics, Inc. Price and EPS Surprise

Arrow Electronics, Inc. Price and EPS Surprise
Arrow Electronics, Inc. Price and EPS Surprise

Arrow Electronics, Inc. price-eps-surprise | Arrow Electronics, Inc. Quote

Factors to Note Ahead of Q4 Results

Arrow’s fourth-quarter performance is likely to have benefited from high demand for its electronic components. Further, America is anticipated to have registered higher revenues, which typically generate high margins. This is likely to have boosted the profitability in the to-be-reported quarter.

The solid uptrend in design activity across all regions is also anticipated to have boosted the top line in the fourth quarter. Strong demand for the infrastructure software, next-generation hardware and hybrid cloud architectures are expected to have aided the quarterly performance.

Arrow’s core strength of providing best-in-class services and easy-to-acquire technologies is likely to have fueled growth in the to-be-reported quarter. Its continued focus on boosting the Internet of things capabilities is likely to have helped it expand in newer markets and gain customers.

The Zacks Consensus Estimate for the Global Component segment’s revenues is pegged at $6.5 billion, calling for an approximately 10% year-over-year increase. The consensus mark for the Global ECS division’s sales stands at $2.35 billion, indicating a year-over-year decline of 7.2%.

Also, efficient cost-reduction programs are expected to have been an upside for margins during the fiscal fourth quarter.

However, headwinds related to the pandemic, including supply-chain challenges, might have prevailed through the fourth quarter. Also, lower pricing and higher logistics costs might have partially offset the benefits of cost-saving initiatives for margins.

What Our Model Says

Our proven model does not predict an earnings beat for ARW this season. The combination of a positive Earnings ESP and Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. However, that’s not the case here.

Arrow currently carries a Zacks Rank of 3 and has an Earnings ESP of 0.00%. You can uncover the best stocks to buy or sell, before they’re reported, with our Earnings ESP Filter.

Stocks With the Favorable Combination

Per our model, Analog Devices ADI, CDW Corporation CDW and Keysight Technologies KEYS have the right combination of elements to post an earnings beat in their upcoming releases.

Analog Devices carries a Zacks Rank #2 and has an Earnings ESP of +0.25%. The company is scheduled to report first-quarter fiscal 2022 results on Feb 16. Analog Devices’ earnings surpassed the Zacks Consensus Estimate in the trailing four quarters, the average surprise being 6.1%. You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for ADI’s first-quarter earnings is pegged at $1.79 per share, indicating year-over-year growth of 24.3%. The consensus mark for revenues stands at $2.61 billion, suggesting a year-over-year increase of 67.3%.

CDW Corporation is slated to report fourth-quarter 2021 results on Feb 9. The company carries a Zacks Rank #2 and has an Earnings ESP of +2.63% at present. CDW Corporation’s earnings beat the Zacks Consensus Estimate in the preceding four quarters, the average surprise being 12.2%.

The Zacks Consensus Estimate for CDW’s quarterly earnings is pegged at $1.90 per share, suggesting a year-over-year improvement of 4.4%. CDW Corporation’s quarterly revenues are estimated to increase 3.4% year over year to $5.12 billion.

Keysight currently carries a Zacks Rank #2 and has an Earnings ESP of +1.15%. The company is slated to report its first-quarter fiscal 2022 results on Feb 17. Keysight’s earnings beat the Zacks Consensus Estimate in the preceding four quarters, the average surprise being 7.1%.

The Zacks Consensus Estimate for Keysight’s first-quarter earnings stands at $1.56 per share, implying a year-over-year increase of 9.1%. KEYS is estimated to report revenues of $1.24 billion, which suggests growth of 5.3% from the year-ago quarter.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.


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Analog Devices, Inc. (ADI) : Free Stock Analysis Report

Arrow Electronics, Inc. (ARW) : Free Stock Analysis Report

CDW Corporation (CDW) : Free Stock Analysis Report

Keysight Technologies Inc. (KEYS) : Free Stock Analysis Report

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