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Avnet
(NASDAQ:AVT)
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Rating:63Neutral
Price Target:
$99.00
▲(10.71% Upside)
Action:Reiterated
Date:08/05/26
AVT’s score is held back most by weak cash generation (negative operating and free cash flow) and compressed margins, despite a strong revenue rebound and a reasonable balance-sheet profile. Technicals are supportive with price above key moving averages and positive momentum indicators, while valuation is a modest headwind given the high P/E and moderate dividend yield. The latest earnings call was net positive with upbeat guidance and margin/working-capital improvement targets, but acknowledged ongoing risks around margin pressure, inventory, and cash usage.
Positive Factors
Business model & scale
Avnet’s broad distribution model, deep supplier line‑card and global logistics create durable competitive advantages: scale lowers sourcing costs, wide product breadth increases customer stickiness, and engineering/logistics services raise switching costs and support recurring revenue across end markets.
Negative Factors
Weak cash generation
Negative operating and free cash flow in the trailing twelve months is structural risk for a distributor reliant on working-capital cycles. Continued cash burn constrains reinvestment, debt reduction and buybacks, and increases reliance on committed credit unless working-capital conversion sustainably improves.
Read all positive and negative factors
Positive Factors
Negative Factors
Business model & scale
Avnet’s broad distribution model, deep supplier line‑card and global logistics create durable competitive advantages: scale lowers sourcing costs, wide product breadth increases customer stickiness, and engineering/logistics services raise switching costs and support recurring revenue across end markets.
Read all positive factors
Avnet (AVT) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$7.29B
Dividend Yield1.58%
Average Volume (3M)1.17M
Price to Earnings (P/E)34.1
Beta (1Y)1.08
Revenue Growth12.68%
EPS Growth-27.94%
CountryUS
Employees14,869
SectorTechnology
Sector Strength88
IndustryTechnology Distributors
Share Statistics
EPS (TTM)2.60
Shares Outstanding82,024,080
10 Day Avg. Volume954,601
30 Day Avg. Volume1,174,951
Financial Highlights & Ratios
PEG Ratio-0.39
Price to Book (P/B)0.91
Price to Sales (P/S)0.21
P/FCF Ratio7.94
Enterprise Value/Market Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda<0.01
Forecast
1Y Price Target
$84.00Price Target Upside-6.06% Downside
Rating ConsensusModerate Sell
Number of Analyst Covering2
EPS Forecast (FY)8.14
Revenue Forecast (FY)$31.03B
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 structur...
How the Company Makes Money
Avnet makes money primarily by distributing electronic components and embedded solutions and earning a margin between its purchase cost from suppliers and the resale price to customers. Key revenue streams include: (1) Component distribution: sell...
Avnet Earnings Call Summary
Earnings Call Date:Aug 05, 2026
(Q4-2026)
| Next Earnings Date:Nov 04, 2026
Earnings Call Sentiment Positive
The call communicated a strong and broad‑based operational and financial recovery: record sales, record EPS, sustained margin expansion, improved working capital metrics and clear momentum across regions and segments. Management acknowledged pockets of risk — notably memory‑driven pricing, higher inventory dollars and a tightening supply environment with extended lead times — but characterized these as manageable and partially indicative of genuine demand recovery rather than excess stocking. Guidance for the next quarter is optimistic and capital allocation prioritizes funding growth while progressing toward leverage targets. Overall, the positive operational and financial progress materially outweighs the highlighted challenges.Positive Updates
Record Quarterly Sales and Strong Year‑Over‑Year Growth
Fourth quarter sales of $8.3 billion, a record for the company, up 48% year‑over‑year and up 17% sequentially.
Negative Updates
Gross Profit Margin Slightly Weakened Year‑Over‑Year
Overall gross profit margin was 10.4%, up 5 basis points sequentially but down 14 basis points year‑over‑year. Electronic Components gross margin was flat sequentially and down ~25 basis points YoY.
Read all updates
Q4-2026 Updates
Positive
Negative
Record Quarterly Sales and Strong Year‑Over‑Year Growth
Fourth quarter sales of $8.3 billion, a record for the company, up 48% year‑over‑year and up 17% sequentially.
Read all positive updates
Company Guidance
Avnet guided first‑quarter fiscal 2027 sales of $9.0–$9.3 billion and adjusted diluted EPS of $2.80–$2.90 (midpoint implying ~10% sequential sales growth), assuming current market conditions, similar interest expense to Q4, an effective tax rate of 21–25% and ~85 million diluted shares; management said near‑term EPS should grow roughly 3x sales and operating income about 2x sales, expects SG&A as a percent of gross profit to fall below 60% before the end of FY2027, is targeting ~3x leverage by year‑end (gross leverage was 3.2x this quarter, down from 3.6x, with ~$1.2B of committed borrowing capacity), and will prioritize funding accelerating growth and the dividend while using cash in Q1 to support accounts receivable — all while monitoring working capital (Q4 inventory days 71 with EC <65 and Farnell ~200, working capital days 69, inventory up 11% or ~$600M, and return on working capital 19% vs. a 16% target).Avnet Financial Statement Overview
Summary
Income Statement
68
Positive
Balance Sheet
72
Positive
Cash Flow
38
Negative
| Breakdown | TTM | Jun 2025 | Jun 2024 | Jun 2023 | Jun 2022 | Jun 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 24.96B | 22.20B | 23.76B | 26.54B | 24.31B | 19.53B |
| Gross Profit | 2.61B | 2.38B | 2.77B | 3.18B | 2.97B | 2.24B |
| EBITDA | 688.58M | 626.24M | 1.06B | 1.38B | 1.09B | 451.10M |
| Net Income | 213.90M | 240.22M | 498.70M | 770.83M | 692.38M | 193.11M |
Balance Sheet | ||||||
| Total Assets | 13.49B | 12.12B | 12.21B | 12.48B | 10.39B | 8.93B |
| Cash, Cash Equivalents and Short-Term Investments | 202.44M | 192.43M | 310.94M | 288.23M | 153.69M | 199.69M |
| Total Debt | 3.17B | 2.88B | 3.18B | 3.30B | 1.87B | 1.51B |
| Total Liabilities | 8.54B | 7.11B | 7.28B | 7.73B | 6.20B | 4.84B |
| Stockholders Equity | 4.95B | 5.01B | 4.93B | 4.75B | 4.19B | 4.08B |
Cash Flow | ||||||
| Free Cash Flow | 32.88M | 577.03M | 463.51M | -908.38M | -268.21M | 40.59M |
| Operating Cash Flow | 149.29M | 724.50M | 689.98M | -713.70M | -219.31M | 90.95M |
| Investing Cash Flow | -115.42M | -137.13M | -225.48M | -211.55M | 51.30M | -61.20M |
| Financing Cash Flow | -21.61M | -693.53M | -433.80M | 1.05B | 156.06M | -314.01M |
Avnet Technical Analysis
Positive
89.42
Price Trends
87.71
Positive
79.74
Positive
66.40
Positive
Market Momentum
0.74
Negative
61.20
Neutral
75.21
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AVT, the sentiment is Positive. The current price of 89.42 is above the 20-day moving average (MA) of 87.20, above the 50-day MA of 87.71, and above the 200-day MA of 66.40, indicating a bullish trend. The MACD of 0.74 indicates Negative momentum. The RSI at 61.20 is Neutral, neither overbought nor oversold. The STOCH value of 75.21 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for AVT.
Avnet Risk Analysis
Avnet disclosed 20 risk factors in its most recent earnings report. Avnet reported the most risks in the "Macro & Political" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Avnet Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
76 Outperform | $500.29M | 23.83 | 17.50% | 0.67% | 23.05% | -7.49% | |
75 Outperform | $11.07B | 15.37 | 11.15% | ― | 20.49% | 92.31% | |
69 Neutral | $1.15B | 17.16 | 8.07% | ― | 3.76% | 18.30% | |
63 Neutral | $7.29B | 34.14 | 4.33% | 1.57% | 12.68% | -27.94% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% | |
61 Neutral | $3.89B | 22.42 | 11.17% | ― | -1.83% | -2.39% | |
55 Neutral | $3.24M | 2.69 | 7.76% | ― | ― | ― |
* Technology Sector Average
AVT
Avnet
92.53
44.20
91.46%
ARW
Arrow Electronics
227.67
111.46
95.91%
NSIT
Insight Enterprises
137.26
20.03
17.09%
SCSC
ScanSource
58.89
19.40
49.13%
CLMB
Climb Global Solutions
26.78
-0.29
-1.06%
IZM
ICZOOM Group, Inc. Class A
0.28
-2.29
-89.26%
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.