Analyzing Avnet (AVT) and Its Peers

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

Earnings & Valuation

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

	Gross Revenue	Net Income	Price/Earnings Ratio
Avnet	$27.63 billion	$334.39 million	12.48
Avnet Competitors	$115.48 billion	$173.80 million	5.14

Avnet’s competitors have higher revenue, but lower earnings than Avnet. Avnet is trading at a higher price-to-earnings ratio than its competitors, indicating that it is currently more expensive than other companies in its industry.

Risk and Volatility

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

Analyst Recommendations

This is a breakdown of current ratings and target prices for Avnet and its competitors, 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	7618	10451	665	2.47

Avnet presently has a consensus price target of $100.25, suggesting a potential upside of 20.65%. As a group, “Electronic Equipment, Instruments & Components” companies have a potential upside of 37.73%. Given Avnet’s competitors higher probable upside, analysts plainly believe Avnet has less favorable growth aspects than its competitors.

Institutional & 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, 16.0% of shares of all “Electronic Equipment, Instruments & Components” companies are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Avnet	1.74%	14.15%	4.72%
Avnet Competitors	-141.19%	-31.04%	-7.22%

Dividends

Avnet pays an annual dividend of $1.48 per share and has a dividend yield of 1.8%. 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 69.3% of their earnings in the form of a dividend. Avnet has increased its dividend for 12 consecutive years.

Summary

Avnet beats its competitors on 10 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.