Arrow Electronics Inc. Common Stock (ARW)

FairStock Score: 63/100 — STEADY

Key Financials

AI Analysis

AI-generated, general educational analysis — not personal investment advice.

I am wary of distribution businesses that earn pennies on the dollar, yet I respect those with scale. Arrow Electronics moves electronic components and enterprise computing solutions, with 22,230 employees and fiscal Q2 2026, the quarter ended 2026-07-04, revenue of $10.0B and net income of $272.7M—a 2.73% net margin. That is thin. The latest quarter was much stronger than fiscal Q2 2025, the quarter ended 2025-06-28, when revenue was $7.6B and net income $187.7M, and diluted EPS rose to $5.26 from $3.59. But the longer record is uneven: FY2025, the period ended 2025-12-31, revenue was $30.9B with net income $571.3M and diluted EPS $10.93, while FY2023, the period ended 2023-12-31, net income was $903.5M and diluted EPS $15.84. The computed Lynch category is SLOW GROWER—Shrinking, with profit -0.5% a year over five years and revenue 1.5%—so I would not pay a high multiple for this growth profile. The balance sheet is not reckless: debt-to-equity is 0.31 and free cash flow is $825.5M, a 7.0% FCF yield on the $11.8B market cap. Yet ROCE is only 2.66%, ROE 12.04%, and the Altman Z-Score of 0.97 suggests limited safety. At the 2026-10-13 close of $231.75, the FairStock P/E is 14.80, P/B 1.69, and the Graham Number is $220.05, leaving a -5.32% margin of safety. The PEG of 0.33 looks cheap only if recent profit growth persists; the five-year record says be skeptical. Arrow has scale but little pricing power, and the stock is near fair value at best.

In plain English: Arrow Electronics helps manufacturers and other businesses buy and design the electronic parts and computing systems they need. In the quarter ended 2026-07-04, it reported $10.0 billion of revenue and $272.7 million of net income, but its longer profit record has been uneven and margins are thin. At the 2026-10-13 close of $231.75, the price looks roughly fair, though it is slightly above a conservative value estimate and not an obvious bargain.

The full AI analysis, bull and bear case and key monitorables are in FairStock Pro.

Data as of 2026-10-13 close · note generated 2026-10-15 · model deepseek-flash

Sources (SEC EDGAR): fiscal Q2 2026 10-Q (period ended 2026-07-04) · fiscal Q1 2026 10-Q (period ended 2026-04-04) · fiscal Q3 2025 10-Q (period ended 2025-09-27) · fiscal Q2 2025 10-Q (period ended 2025-06-28) · FY2025 10-K (period ended 2025-12-31) · FY2024 10-K (period ended 2024-12-31) · FY2023 10-K (period ended 2023-12-31)

Fundamentals from company filings and market-data providers; prices are end-of-day, not real-time. AI-generated analysis is general and educational — not personal investment advice. Scoring methodology · Score test · Disclaimer