Head to Head Comparison: Arrow Electronics (NYSE:ARW) vs. Sanmina (NASDAQ:SANM)

Sanmina (NASDAQ:SANM) and Arrow Electronics (NYSE:ARW) are both large-cap technology companies, but which is the superior stock? We will contrast the two businesses based on the strength of their risk, earnings, dividends, analyst recommendations, institutional ownership, valuation and profitability.

Volatility & Risk

Sanmina has a beta of 1.6, meaning that its stock price is 60% more volatile than the S&P 500. Comparatively, Arrow Electronics has a beta of 1.19, meaning that its stock price is 19% more volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current ratings and price targets for Sanmina and Arrow Electronics, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Sanmina	0	2	2	1	2.80
Arrow Electronics	1	1	3	1	2.67

Sanmina currently has a consensus target price of $198.33, indicating a potential downside of 8.18%. Arrow Electronics has a consensus target price of $233.25, indicating a potential upside of 2.09%. Given Arrow Electronics’ higher possible upside, analysts clearly believe Arrow Electronics is more favorable than Sanmina.

Institutional & Insider Ownership

92.7% of Sanmina shares are owned by institutional investors. Comparatively, 99.3% of Arrow Electronics shares are owned by institutional investors. 3.1% of Sanmina shares are owned by company insiders. Comparatively, 0.8% of Arrow Electronics shares 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 Sanmina and Arrow Electronics’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Sanmina	2.41%	19.08%	5.75%
Arrow Electronics	2.26%	13.41%	2.83%

Earnings and Valuation

This table compares Sanmina and Arrow Electronics”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Sanmina	$12.76 billion	0.91	$245.89 million	$5.59	38.64
Arrow Electronics	$30.85 billion	0.38	$571.27 million	$15.65	14.60

Arrow Electronics has higher revenue and earnings than Sanmina. Arrow Electronics is trading at a lower price-to-earnings ratio than Sanmina, indicating that it is currently the more affordable of the two stocks.

Summary

Sanmina beats Arrow Electronics on 8 of the 14 factors compared between the two stocks.

About Sanmina

Sanmina Corporation provides integrated manufacturing solutions, components, products and repair, logistics, and after-market services worldwide. It operates in two businesses, Integrated Manufacturing Solutions; and Components, Products and Services. The company offers product design and engineering, including concept development, detailed design, prototyping, validation, preproduction, manufacturing design release, and product industrialization; assembly and test services; direct order fulfillment and logistics services; after-market product service and support; and supply chain management services, as well as engages in the manufacturing of components, subassemblies, and complete systems. In addition, the company provides components, such as printed circuit boards, backplane and backplane assemblies, cable assemblies, fabricated metal parts, precision machined parts, and plastic injected molded parts; memory solutions; storage platforms; optical, radio frequency, and microelectronic solutions; defense and aerospace product, design, manufacturing, repair, and refurbishment services; and cloud-based manufacturing execution software. It offers its products and services primarily to original equipment manufacturers in the industrial, medical, defense and aerospace, automotive, communications networks, and cloud solutions. Sanmina Corporation was incorporated in 1980 and is headquartered in San Jose, California.

About Arrow Electronics

Arrow Electronics, Inc. provides products, services, and solutions to industrial and commercial users of electronic components and enterprise computing solutions in the Americas, Europe, the Middle East, Africa, and the Asia Pacific. The company operates in two segments, Global Components and Global Enterprise Computing Solutions. The Global Components segment markets and distributes electronic components comprising semiconductor products and related services; interconnect, passive, and electromechanical products, including capacitors, resistors, potentiometers, power supplies, relays, switches, and connectors; and computing and memory products, as well as other products and services. The Global Enterprise Computing Solutions segment offers computing solutions, such as datacenter, cloud, security, and analytics solutions. This segment also provides access to various services, including engineering and integration support, warehousing and logistics, marketing resources, and authorized hardware and software training. The company serves original equipment manufacturers, value-added resellers, managed service providers, contract manufacturers, and other commercial customers. Arrow Electronics, Inc. was founded in 1935 and is based in Centennial, Colorado.