Reviewing Avnet (AVT) and The Competition

Avnet (NASDAQ:AVT) is one of 377 public companies in the “Electronic Equipment, Instruments & Components” industry, but how does it compare to its peers? We will compare Avnet to similar businesses based on the strength of its profitability, institutional ownership, analyst recommendations, dividends, risk, earnings and valuation.

Analyst Ratings

This is a summary of current ratings and price targets for Avnet and its peers, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Avnet	1	2	2	1	2.50
Avnet Competitors	2047	7591	10404	655	2.47

Avnet currently has a consensus price target of $93.25, indicating a potential upside of 8.13%. As a group, “Electronic Equipment, Instruments & Components” companies have a potential upside of 36.95%. Given Avnet’s peers higher probable upside, analysts plainly believe Avnet has less favorable growth aspects than its peers.

Profitability

This table compares Avnet and its peers’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Avnet	1.21%	9.57%	3.47%
Avnet Competitors	-158.15%	-25.69%	-6.84%

Institutional and Insider Ownership

95.8% of Avnet shares are owned by institutional investors. Comparatively, 43.5% of shares of all “Electronic Equipment, Instruments & Components” companies are owned by institutional investors. 2.0% of Avnet shares are owned by company insiders. Comparatively, 16.2% of shares of all “Electronic Equipment, Instruments & Components” companies are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Dividends

Avnet pays an annual dividend of $1.48 per share and has a dividend yield of 1.7%. Avnet pays out 37.1% of its earnings in the form of a dividend. As a group, “Electronic Equipment, Instruments & Components” companies pay a dividend yield of 1.9% and pay out 70.1% of their earnings in the form of a dividend. Avnet has raised its dividend for 12 consecutive years.

Volatility and Risk

Avnet has a beta of 1.06, suggesting that its stock price is 6% more volatile than the S&P 500. Comparatively, Avnet’s peers have a beta of -0.32, suggesting that their average stock price is 132% less volatile than the S&P 500.

Earnings & Valuation

This table compares Avnet and its peers gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Avnet	$27.63 billion	$334.39 million	21.61
Avnet Competitors	$4.00 billion	$166.60 million	5.93

Avnet has higher revenue and earnings than its peers. Avnet is trading at a higher price-to-earnings ratio than its peers, indicating that it is currently more expensive than other companies in its industry.

Summary

Avnet beats its peers on 11 of the 15 factors compared.

About Avnet

Avnet, Inc., distributes electronic component technology. The company operates through two segments, Electronic Components and Farnell. The Electronic Components segment markets, sells, and distributes semiconductors; interconnect, passive, and electromechanical components; and other integrated components from electronic component manufacturers. It also offers design chain support that provides engineers with technical design solutions; engineering and technical resources to support product design, bill of materials development, and technical education and training; and supply chain solutions that provide support and logistical services to original equipment manufacturers, electronic manufacturing service providers, and electronic component manufacturers. In addition, this segment provides embedded solutions, such as technical design, integration, and assembly of embedded products, systems, and solutions primarily for industrial applications, as well as embedded display solutions comprising touch and passive displays; and develops and manufactures standard board and industrial subsystems, and application-specific devices that enable it to produce systems tailored to specific customer requirements. This segment serves various markets, such as automotive, medical, defense, aerospace, telecommunications, industrial, and digital editing. The Farnell segment distributes kits, tools, and electronic and industrial automation components, as well as test and measurement products to engineers and entrepreneurs. It has operations in the Americas, Europe, the Middle East, Africa, and Asia. Avnet, Inc. was founded in 1921 and is headquartered in Phoenix, Arizona.