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CENTENNIAL, Colo. - Arrow Electronics (NYSE:ARW), a prominent $5.39 billion market cap player in the Electronic Equipment industry, has entered into a distribution agreement with Ohmite Manufacturing, a leading provider of power resistor solutions. This partnership, announced earlier this week, is set to broaden the availability of Ohmite’s products, including high power and high voltage resistors, to Arrow’s extensive global customer base. According to InvestingPro analysis, Arrow’s stock is currently trading near its 52-week low, suggesting potential opportunity for value investors.
Ohmite, currently celebrating its centennial, is recognized for its wide array of resistors used in various sectors such as transportation, industrial, energy, and aerospace. The company’s portfolio includes load banks, rheostats, power controls, heatsinks, and capacitors, alongside their standard and custom resistor solutions.
Aiden Mitchell, senior vice president of global supplier management at Arrow Electronics, remarked on the significance of this collaboration, stating that it aligns with Arrow’s commitment to delivering a diverse range of electronic components. The inclusion of Ohmite’s resistor products is expected to satisfy the evolving demands of consumers by enriching the product options available to them.
Greg Pace, CEO of Ohmite, expressed enthusiasm about the growth and global outreach opportunities presented by partnering with Arrow Electronics. He highlighted that this addition to their distribution channels marks an important step in the company’s ongoing reorganization, which focuses on their new and legacy products as well as custom solution capabilities.
Arrow has already made Ohmite’s products accessible through its website, allowing customers to purchase the components conveniently.
Arrow Electronics, a major source and engineer of technology solutions, reported global sales of $27.9 billion in the last twelve months. Trading at an attractive P/E ratio of 14x and showing strong free cash flow yield, the company appears undervalued according to InvestingPro Fair Value metrics. Its offerings empower technological advancements across key industries and markets. For deeper insights into Arrow’s valuation and 12 additional exclusive ProTips, including management’s aggressive share buybacks, check out the comprehensive Pro Research Report available on InvestingPro.
This partnership is based on a press release statement and aims to enhance the distribution and accessibility of Ohmite’s power resistor solutions through Arrow’s global network. With the company’s next earnings report due on May 1, 2025, investors can access detailed financial analysis and future growth projections through InvestingPro’s extensive coverage of over 1,400 US stocks.
In other recent news, Arrow Electronics reported its fourth-quarter results for 2024, exceeding market expectations. The company posted non-GAAP earnings per share of $2.97, surpassing the anticipated $2.64, and revenues of $7.28 billion, which were higher than the expected $7.01 billion. Despite these strong results, BofA Securities downgraded Arrow Electronics from Neutral to Underperform and reduced the price target from $133 to $99. This decision was influenced by a lower-than-anticipated forecast for the first quarter of fiscal 2025, with projected revenues and EPS falling short of prior estimates.
The downgrade by BofA reflects concerns about seasonal trends in the Enterprise Computing Solutions segment and margin pressures in the Components segment, particularly in Europe. BofA has adjusted its earnings estimate for calendar year 2025 from $13.65 to $10.25, anticipating several weak quarters ahead. Arrow Electronics provided guidance for Q1 2025, with sales expected between $5.98 billion and $6.58 billion and EPS ranging from $1.30 to $1.50. The company expressed cautious optimism about an improving trajectory in 2025, citing improved inventory levels and strategic investments in cloud and AI solutions.
Arrow Electronics’ management noted a gradual reduction of excess inventory and an improving book-to-bill ratio, with two out of three operating regions ending the fourth quarter near parity. Despite these positive indicators, BofA anticipates that Arrow Electronics will underperform relative to other companies in its coverage due to near-term impacts on revenues and margins.
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