Need To Know: Analysts Are Much More Bullish On Arrow Electronics, Inc. (NYSE:ARW)

Shareholders in Arrow Electronics, Inc. (NYSE:ARW) may be thrilled to learn that the analysts have just delivered a major upgrade to their near-term forecasts. Consensus estimates suggest investors could expect greatly increased statutory revenues and earnings per share, with the analysts modelling a real improvement in business performance.

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After this upgrade, Arrow Electronics' four analysts are now forecasting revenues of US$48b in 2027. This would be a sizeable 22% improvement in sales compared to the last 12 months. Per-share earnings are expected to expand 18% to US$23.81. Previously, the analysts had been modelling revenues of US$43b and earnings per share (EPS) of US$20.20 in 2027. So we can see there's been a pretty clear increase in analyst sentiment in recent times, with both revenues and earnings per share receiving a decent lift in the latest estimates.

View our latest analysis for Arrow Electronics

Despite these upgrades, the consensus price target fell 8.0% to US$216, perhaps signalling that the uplift in performance is not expected to last.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Arrow Electronics' past performance and to peers in the same industry. For example, we noticed that Arrow Electronics' rate of growth is expected to accelerate meaningfully, with revenues forecast to exhibit 17% growth to the end of 2027 on an annualised basis. That is well above its historical decline of 2.3% a year over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenue grow 15% per year. So while Arrow Electronics' revenues are expected to improve, it seems that it is expected to grow at about the same rate as the overall industry.

The Bottom Line

The biggest takeaway for us from these new estimates is that analysts upgraded their earnings per share estimates, with improved earnings power expected for next year. They also upgraded their revenue forecasts, although the latest estimates suggest that Arrow Electronics will grow in line with the overall market. A lower price target is not intuitively what we would expect from a company whose business prospects are improving - at least judging by these forecasts - but if the underlying fundamentals are strong, Arrow Electronics could be one for the watch list.

Even so, the longer term trajectory of the business is much more important for the value creation of shareholders. At Simply Wall St, we have a full range of analyst estimates for Arrow Electronics going out to 2028, and you can see them free on our platform here..

Of course, seeing company management invest large sums of money in a stock can be just as useful as knowing whether analysts are upgrading their estimates. So you may also wish to search this free list of stocks with high insider ownership.

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