Shares of Avnet (AVT) have been strong performers lately, with the stock up 19.6% over the past month. The stock hit a new 52-week high of $73.94 in the previous session. Avnet has gained 49.2% since the start of the year compared to the 2.4% gain for the Zacks Computer and Technology sector and the 38.9% return for the Zacks Electronics - Parts Distribution industry.
What's Driving the Outperformance?
The stock has an impressive record of positive earnings surprises, as it hasn't missed our earnings consensus estimate in any of the last four quarters. In its last earnings report on January 28, 2026, Avnet reported EPS of $1.05 versus consensus estimate of $0.95.
For the current fiscal year, Avnet is expected to post earnings of $4.62 per share on $24.68 in revenues. This represents a 34.3% change in EPS on a 11.16% change in revenues. For the next fiscal year, the company is expected to earn $6.82 per share on $25.28 in revenues. This represents a year-over-year change of 47.58% and 2.42%, respectively.
Valuation Metrics
Avnet may be at a 52-week high right now, but what might the future hold for the stock? A key aspect of this question is taking a look at valuation metrics in order to determine if the company is due for a pullback from this level.
On this front, we can look at the Zacks Style Scores, as they provide investors with an additional way to sort through stocks (beyond looking at the Zacks Rank of a security). These styles are represented by grades running from A to F in the categories of Value, Growth, and Momentum, while there is a combined VGM Score as well. Investors should consider the style scores a valuable tool that can help you to pick the most appropriate Zacks Rank stocks based on their individual investment style.
Avnet has a Value Score of B. The stock's Growth and Momentum Scores are A and D, respectively, giving the company a VGM Score of A.
In terms of its value breakdown, the stock currently trades at 15.5X current fiscal year EPS estimates, which is not in-line with the peer industry average of 17.7X. On a trailing cash flow basis, the stock currently trades at 14.1X versus its peer group's average of 16X. Additionally, the stock has a PEG ratio of 0.53. This isn't enough to put the company in the top echelon of all stocks we cover from a value perspective.
Zacks Rank
We also need to consider the stock's Zacks Rank, as this supersedes any trend on the style score front. Fortunately, Avnet currently has a Zacks Rank of #1 (Strong Buy) thanks to favorable earnings estimate revisions from covering analysts.
Since we recommend that investors select stocks carrying Zacks Rank of 1 (Strong Buy) or 2 (Buy) and Style Scores of A or B, it looks as if Avnet passes the test. Thus, it seems as though Avnet shares could still be poised for more gains ahead.
How Does AVT Stack Up to the Competition?
Shares of AVT have been soaring, and the company still appears to be a decent choice, but what about the rest of the industry? One industry peer that looks good is Arrow Electronics, Inc. (ARW). ARW has a Zacks Rank of #1 (Strong Buy) and a Value Score of B, a Growth Score of C, and a Momentum Score of B.
Earnings were strong last quarter. Arrow Electronics, Inc. beat our consensus estimate by 23.66%, and for the current fiscal year, ARW is expected to post earnings of $13.59 per share on revenue of $33.68 billion.
Shares of Arrow Electronics, Inc. have gained 23.3% over the past month, and currently trade at a forward P/E of 12.78X and a P/CF of 12.07X.
The Electronics - Parts Distribution industry is in the top 4% of all the industries we have in our universe, so it looks like there are some nice tailwinds for AVT and ARW, even beyond their own solid fundamental situation.
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Avnet, Inc. (AVT): Free Stock Analysis Report
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This article originally published on Zacks Investment Research (zacks.com).