Avnet (AVT) and Its Competitors Critical Comparison

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

Institutional & Insider Ownership

95.8% of Avnet shares are owned by institutional investors. Comparatively, 43.2% 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, 16.4% 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 is poised for long-term growth.

Analyst Ratings

This is a summary of recent recommendations for Avnet and its peers, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Avnet	1	2	2	1	2.50
Avnet Competitors	2049	7614	10449	665	2.47

Avnet presently has a consensus target price of $100.25, indicating a potential upside of 26.45%. As a group, “Electronic Equipment, Instruments & Components” companies have a potential upside of 41.25%. Given Avnet’s peers higher possible upside, analysts plainly believe Avnet has less favorable growth aspects than its peers.

Valuation & Earnings

This table compares Avnet and its peers revenue, earnings per share and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Avnet	$27.63 billion	$334.39 million	11.90
Avnet Competitors	$4.00 billion	$172.92 million	4.89

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.

Dividends

Avnet pays an annual dividend of $1.48 per share and has a dividend yield of 1.9%. Avnet pays out 22.2% of its earnings in the form of a dividend. As a group, “Electronic Equipment, Instruments & Components” companies pay a dividend yield of 2.0% and pay out 69.0% of their earnings in the form of a dividend. Avnet has raised its dividend for 12 consecutive years.

Risk & Volatility

Avnet has a beta of 1.11, meaning that its stock price is 11% more volatile than the S&P 500. Comparatively, Avnet’s peers have a beta of -0.29, meaning that their average stock price is 129% less volatile than the S&P 500.

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	-158.14%	-25.87%	-6.85%

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.