Bullish indicating open at $55-$60, IPO prices at $37
On March 12, 2025, Arrow Electronics , Inc. (NYSE:ARW) Director William F. Austen acquired 1,900 shares of the company’s common stock. The purchase was made at a price of $104.12 per share, totaling approximately $197,828. Following this transaction, Austen’s direct ownership in the company stands at 7,858.26 shares. The timing of this insider purchase is notable as the stock trades near its 52-week low of $102.21, with InvestingPro analysis indicating the stock is currently undervalued.
Arrow Electronics, headquartered in Centennial, Colorado, is a major player in the wholesale electronic parts and equipment industry. With a market capitalization of $5.3 billion and a P/E ratio of 13.9x, the company has demonstrated strong management commitment through aggressive share buybacks. Discover more comprehensive insights and 12 additional ProTips with InvestingPro’s detailed research report.
In other recent news, Arrow Electronics reported a strong fourth quarter for fiscal 2024, with revenues reaching $7.28 billion and non-GAAP earnings per share (EPS) of $2.97, both surpassing market expectations. Despite these results, the company anticipates a weaker first quarter for fiscal 2025, with projected revenues between $5.98 billion and $6.58 billion and EPS ranging from $1.30 to $1.50. BofA Securities downgraded Arrow Electronics’ stock rating from Neutral to Underperform, citing the lower-than-expected forecast for the upcoming quarter and adjusting its price target from $133 to $99.
The downgrade by BofA reflects concerns over seasonal trends affecting the Enterprise Computing Solutions segment and margin pressures in the Components segment, particularly in Europe. BofA has also revised its earnings estimate for calendar year 2025 from $13.65 to $10.25. Meanwhile, Arrow Electronics is focusing on cost reduction and strategic investments in cloud and AI solutions, with the company expressing cautious optimism for 2025 as inventory levels improve. The company reported a 7% year-over-year decline in consolidated sales, but noted a 12% year-over-year growth in Enterprise Computing Solutions sales.
Arrow’s management highlighted an improving book-to-bill ratio and a reduction in excess inventory, though BofA anticipates several weak quarters ahead. The new price objective set by BofA is based on a 10x multiple of the revised estimated EPS for calendar year 2025. Despite the challenges, Arrow Electronics is committed to navigating the current semiconductor market conditions and positioning itself for future growth opportunities.
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